a) You're simply wrong in saying that only white liberals have a problem with it.
b) it's commonly used because the term is used commonly in the Canadian and American constitutions surrounding the status of Indigenous Peoples
c) what a scholarly source you've selected
I have yet to meet any Native American university student, scholar, or writer who prefers Canadian Indian to being known as Indigenous.
I'm also curious as to how this being a 'liberal cause' invalidates arguments against the term Canadian/American Indian.
You always call me out on my generalization and I appreciate it. It is a bad habit that I should try to avoid. However, the link I provided should remedy your generalization as it specifically mentions a Native American activist who finds American Indian to be the preferable term. There, now you've seen one.
The point is, there is nothing offensive about being an Indian (the South Asian type). This is different than terms such as red skin which are designed to objectify. The term Indian is simply anachronistic. So you shouldn't lump thought-police issues with what is objectively and substantively harmful.