"Dummy" can have negative connotations, depending upon how it's used. At one time, anyone that was mentally disabled, or slow to learn things, was called a "dummy," which is now considered inappropriate and rude.
"Dummy" is also used in a humorous way, mostly by people poking fun at themselves because they don't understand some sort of new technology or concept. There is a whole series of books based on this phrase: "Computer Programming for Dummies," "Pregnancy for Dummies," "Dog Training for Dummies," etc. In this case, "dummy" is not derogatory, because the person buying the book is admitting to himself that he knows nothing about the topic and wants to learn.
"Dummy" is also sometimes used as a synonym for "mannequin". When automotive companies do safety tests with their vehicles (deliberately crashing them into brick walls and such), they put "dummies" in the seats to simulate humans.