I believe that the usage of the word “frei” originated from the Maskilim, who referred to themselves as “free from mitzvos.” Frum people then perpetrated this by calling the non-frum (not yet frum) as “frei.”
In Israeli society, the word used is “chiloni” or “chofshi.”
Regarding the usage of “shiksa”, refer to the following article, The Jewish N Word:
link removed