It is actually "Ben ik van Dietschen bloed". Guess it's the earliest misheard lyric?
Diets is not the same as Duits.
Diets is Midden Nederlands. Middle Dutch.
Never believe your own propaganda, deutscher Blutsbruder.
That particular "explanation" for the lyric was a scrambled last ditch (or Dutch) effort to underplay the
moffe-connection - at a time when Dutch-German relations were, uhum, somewhat (re)strained. It's been historically disproven.
It's like saying Jesus wasn't really Jewish.