The myth is that Southerners are more racist, and that is because of historic institutionalized programs such as slavery, Jim Crow, and segregation laws. These laws were put in place in by Democrats. In the south there was a term for these people: Dixicrats. Though the specific Dixicrat party has been defunct since 1948, there are still many around (until perhaps Barrack Obama). The fact is, the North was every bit as racist, though it was on more of a social level and not governmental. The second iteration (around 1920 - 1935) of the KKK took place primarily in the North, particularly New York, Pennsylvannia, and Ohio. A lot of this was rooted in depression era unemployment fears ("they terk r gerbs").
To answer your question, the base ideologies really haven't changed. I wouldn't say that "they ended racism and decided to be progressive Republicans," but I would say that their ideology has always been that all people have the potential to better themselves (whether someone believes that to be naïve or not - it is what it is). They don't believe in heavy socialized programs because it takes a way from autonomy (similar to Libertarians and a free market). I can explain that further from a social psychology perspective if you need. Republicans have always believed in regulating morality though. Whether it be ending slavery, fighting abortion, prayer in schools, or arguing against gay marriage. Of course societal norms of morality change.
In terms of modern racial issues it gets very complicated between parties. It seems like the Democratic party changed their ideologies in the late 1950s and early 1960s, but that can be argued (There's a good video I'd like to post for you, but I don't have access to youtube at work). A lot of these social programs aren't just adjuncts to help people get back on their feet, but a form of long-term assistance for people. I believe the intention is good, but when you really question a lot of Democrats they seem to have some underpinning belief that minorities can't fend for themselves without assistance (like unintentionally racist with a good heart). Before the 1960s this was definitely a legitimate concern. Game changers in the Democratic party like John F. Kennedy took a strong invested interest in civil rights. Even some forerunners like Harry Truman had desegregated the military in the late 1940s. This is around the time that African Americans began joining the party (of course). In this day in age it's easy to argue that their programs hurt more than they help, and I mean on a learned helplessness model independent of race.
To sum up, Republicans are always consistent - Everyone has the potential to make their own way economically, but not morally. Democrats ideology maybe has changed more over time, or maybe it hasn't. I've read some interesting articles that say they've become sneakier in their racism. They tend to believe people can make their own way morally, but not economically. Libertarians just believe people can make their own way. Period. In every facet of their life. Of course these three major parties all fall under a continuum of extremism and centralism.
