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You're describing jargon vs colloquial use. If you're talking to your engineer buddy, yeah, use the terms properly or be prepared to offer clarification, because in that context it's pretty important. If you're talking to a psychiatrist, same thing for narcissist.

When it comes to general public, people will use words however they're most commonly used, and that's perfectly fine. The average person doesn't know, can't be expected to learn, and has no use for knowing the definition of jargon that's outside of their day-to-day use.

If the use of colloquial terms is causing you or someone else confusion or losing clarity, ask clarifying questions. That's how professionals or just more knowledgeable people on the subject in general, have had to interface with the average person for like... How long have we had language?