My friend's dad is from Scotland. He came to Canada and works as a dealer at a casino. One day, two obviously gay men sat at his table and one of them put down his pack of cigarettes. My friend's dad then unknowingly said "I'm sorry sir, but we don't allow fags at the table". Everyone learned a bit about regional dialects that day!
It's kind of an old-timey usage. Comes up a lot in Lord of the Rings.
"Gay" in this context is also old-timey.
But a cigarette is still a "fag" to a lot of people. Interestingly uncomfortable for me to even type out even though I grew up with that being a totally normal word!
I know gay and fag mean happy and cigarette, but didn't know that queer was used to mean unusual (like I know it can be defined as that, but didn't think anyone used it like that.)
The song "Star of the County Down", as sung by The High Kings, uses "queer" to mean "unusual". Incidently, I find that to be the best arrange of this classic Irish tune - very melodious.