NSFW Warning, Quotation From 1910s Letter With Racist, Anti-semitic Language, Be advised

What I mean by this is often I'll see people defend atrocious acts or now condemned opinions of past peoples or simply ignore as "A product of the time".

an example being H.P Lovecrafts writings are often considered racist and this is handwaved as a product of the time but it's still there in his works it hasn't and won't go anywhere.

This is a viewpoint which is more prevalent among certain fans than scholarship. The major critics and writers on Lovecraft, such as S. T. Joshi, have never made a point of denying, hiding, or downplaying his racism. In fact, they have contributed hugely toward our understanding of Lovecraft and his prejudices by continuing to push for the unexpurgated collections of his correspondence and essays, showing how Lovecraft expressed his prejudices to various friends and correspondents versus pieces written for public consumption, and how those views changed throughout his life.

Now, there were Lovecraft scholars like Dirk W. Mosig who argued that Lovecraft should not be considered a racist in the contemporary sense. Mosig was writing in the 1970s, after the Holocaust and the Civil Rights Movement in the United States, and he was referring very specifically to the fact that Lovecraft, who died in 1937, was expressing views and opinions from a very different time period, even if only a few decades separated him from when Mosig was writing.

Lovecraft lived at a time when racial segregation was legal, and interracial marriage often wasn't; he saw the rise of the second Ku Klux Klan and Adolf Hitler and the Nazi party, the opening salvos of what would become World War II with the Italian invasion of Ethiopia and the Japanese invasion of Manchuria, but not the end; he was alive when the Immigration Act of 1924 established the quota system, drastically reducing immigration into the US on racial boundaries, and he was alive when "Yellow Peril" literature reached its height.

So it is absolutely the case that Lovecraft should be considered within the context of his time. It is not remarkable given when and where he lived that he should have had prejudices against various ethnicities, against African-Americans, Jews, LGBTQ folks, etc. It is also not surprising that the scientific racialism and events of his era helped shape his views: he uses many of the common classifications for races of Thomas Huxley, for example; during World War I he became more fervently patriotic and xenophobic; several of his specific comments can be traced directly to events and writings of his day.

None of which excuses the fact that he did hold those views. Just because you are raised in a society where racism is common does not mean you have to be racist. Lovecraft could have known better - arguably should have known better. He had more progressive friends, most notably James F. Morton, who was an early member of the NAACP and author of a tract titled The Curse of Race-Prejudice (1906), who would argue with Lovecraft on the subject. The scientific racialism which Lovecraft used to buttress his prejudices was being disproven while he lived by biologists like Franz Boas, and Lovecraft ignored or downplayed the findings, claiming the research was skewed by sentimentality.

Which is to say that the "man of his time" argument is not, or at least should not, be used as an excuse or apologia. It is not the case that Lovecraft could not have held any different opinion on race - and this is obvious because his opinions were not static throughout his life. Although he did hold some of the prejudices from a very young age (by his own accounts in his letters), his exposure to different peoples and points of view throughout his life did cause him to rethink and refine his thoughts on race...

...but prejudices die hard. People don't change often, and when they do it isn't by much. Lovecraft was never "not racist" by our contemporary standards. Neither was he notably "virulent" by most of his contemporary standards (with the possible exception of his wife). What is remarkable about Lovecraft's racism is that we have such a record of it - because he was a prolific letter writer, and as many as 10,000 of his letters were saved and many have been published (and are still being published), and because Lovecraft is still being read. There are dozens of pulp writers who published fiction which is as prejudiced or much cruder in terms of race than anything that Lovecraft wrote, but their work is nowhere near as popular or influential - they are all but forgotten, and so they do not attract the same attention.

So all that being said, let's hit on the rest of your question:

Is there value to judging past actors by today's standards? or is it better to try and maintain an air of neutrality or objectivity towards it?

Lovecraft is still being read. He is long dead; his opinions cannot change, he needs neither demonization or excuses. It is for us the living who read and respond to his work to do something much more difficult: try to understand.