When the seeds of 'otherness' are planted, or there are any signs that point away from normalcy, the ball begins to roll down the slope of dehumanization. In the drowned Giant, the giant's size separates it from the townspeople. Throughout the story, the giant is portrayed to be less and less human, and people perceive him as such. Thus, they treat him with less and less respect.
In beginning of The Drowned Giant the characters perceive the giant's size as a sign of otherness. Throughout the story, the giant is portrayed as less human, leading to the eventual mutilation of his corpse.
In the beginning of "The Drowned Giant", the characters perceive the giant as more human and gradually as the story progresses, the giant's humanity slowly degrades, eventually leading the characters to perceive it's corpse as merely an object.
Throughout the "The Drowned Giant", the giant's humanity slowly degrades as the townspeople perceive his corpse as less and less human; the more they separate themselves from the giant, the less they treat the corpse with respect, leading to the decline of his humanity.