The etymology here is muddled... as etymology almost always is. It's also pretty interesting.
The Wikipedia article has a really (surprisingly) good rundown on the history of the term: https://en.wikipedia.org/wiki/Incel
So, yes, it was originally a term of self-identification dating all the way back to the 1990s.
Usage as an insult began after self-identified incels began making headlines by murdering people. After that, "incel" became shorthand for men who were bitter, alienated, misogynistic, and potentially violent.
A very similar thing happened in the 1990s, after a string of workplace killings by postal workers in the U.S. -- the phrase "going postal" entered the vernacular for a time.
When "incel" is used as an insult like this, I don't believe it is ever meant as a literal reference to the subject's sexual activity or lack thereof; only as a reference to their bitter attitude.