Actually it's not nearly as funny as you think. One of the definitions of "literally" has been "virtually" in a metaphoric, hyperbole, etc., context. This use was used by writers like Dryden and Pope, to indicate "what follows must be taken in the strongest admissible sense" in the 1600s. Yes, this is opposite to the word's original meaning coming from the 1500s, but considering it's been in use in this fashion from BEFORE the 20th century it isn't so far a stretch as to accept it as a proper use.