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"Customer is always right" isn't a trump card for customers to win disputes with the staff. When it comes to matters of preference, yes, the customer is always right. Ketchup on ice cream? Great. Down jacket and shorts? Sure thing! If it makes you happy and you're paying for it then you're always right.
In most other matters though, customers are usually wrong. The idea that random people off the street know more about the products and the way a business should be run than the actual people selling said products and running said business is absolutely ridiculous.
I think the original quote was something along the lines of, "the customer is always right, in mattera of taste". Meaning to accommodate the customers wishes, even if it's ugly or a bad idea or whatever. Like if they want to paint their house pink with green trim, let them
I think it's even broader than that.
If customers want green socks, sell green socks.
It would be have been better said as demand is always right (not supply).