| First of all I disagree with "stolz" being solely used in the meaning of vanity. Second, the dictionary.com definition for "proud" pretty much fits with my definition of "stolz".
Anyway, I wouldn't say that I am proud of my nationality or the nation that comes with it (I am glad about it, but that's a different issue), even by your definition. That's because
1) I can't be proud of something I had no part in creating.
2) There's too many things that suck and are going wrong IMHO in this country that even if I had a part in creating that I wouldn't be proud of it
3) Nationality - even the country itself that it is associated with - is such an abstract, non-tangible thing that I can't so much as conceive the idea of being proud of it
4) One of the most important things any citizen of every citizen of every democratic country should do is to be critical (and watchful) about his country and its gouvernment. I think that pride in it, even in the less "arrogant" meaning, is hurtful to that to some extent. Because I think that pride, like affection, clouds the vision (at least to some extend) when it comes to the uglier parts. How dangerous and blinding that is depends on the "degree" of pride naturally, but I prefer to have my view of this (and any other) nation as scrutinizing as possible...
But then again, I don't necessarily frown immediately when I hear the word pride from one of my fellow citizens. But I might take a closer look at his idea of "pride"... | 
