In general, a nerd is a social outcast in some way shape or form. However nerds can also be socially adjusted and may be popular. In most cases nerds are not very happy people, because despite their levels of popularity, they usually don't have much of a life. While it's perceived that what determines nerdiness is what the person is into, it goes deeper than that. Nerds are usually diagnosed with some type of minor mental disorder (ADHD, Aspergers) and as a result act in a way that many people find strange and may tease them because of it. Also, nostalgia and escapism are two very important things to a nerd. Nostalgia because childhood is always better than adolescence, and this rings especially true for nerds-and escapism for obvious reasons. Common traits for nerds are intelligence, low self-esteem, shyness, sexual frustration and yes, narcissism. Nerd pride, while a healthy thing can also be dangerous. Many nerds become bitter towards society and grow massive egos, which only makes more people hate them. While many nerds are mature and intelligent, many others (despite stereotypes) are ironically just as petty and small-minded as many of their tormentors. Then of course on a smaller level, nerds are defined for their interests. Stereotypically, video games, books (especially of the comic variety), and anime, as well as many other things.
The reason you may see a nerd watching a Disney movie or a children's cartoon takes me back to an earlier point: Nostalgia. Anything that reminds them of their childhood is special to them. As for the knights, pirates, elves, etc, it falls under Escapism. Because when life sucks, escapism is a good temporary way to deal with it. And when it comes to escapism for escapism's sake, the less realistic the better. I have seen a large number of definitions on here that I find disturbing-from both sides of the field-and what I'm here to do is try to dispel the hate a bit. I am here to create a hopefully unbiased definition of the word 'nerd' without insulting nerds but at the same time not instigating everyone else. This will serve to both give nerds something to think about and provide some insight to outsiders who don't understand nerds and may hate them for it.
I hope most of you are satisfied with the above definition (more like a book). Nerds, don't think yourself better than everyone else. It's a good way to become a douchebag and even less popular. Other people, try to have some pity on the nerdy kids and try to understand where they're coming from. Personally I have known shallow, hateful nerds and I've also had intelligent friends who were not nerds. We don't have to make this a war people, if we're intelligent and mature enough to accept the other side, then I think we can get along.