The design displacement is what the (optimistic?) naval architect calculated the weight of water displaced would be if the boat were floating on its design waterline.
Then there's the issue of weight being a factor. Of course it’s a factor, but so is the prismatic coefficient (basically how pointy the underwater sections are), wetted surface area, and several other factors.
Ted Hood, a designer of a wide variety of boats over his career, including America’s Cup winners, and some of my favorite cruising boats, the Bristols and Little Harbors, tells in one of his books of one of his earlier designs. His crew, preparing for a race started removing everything from the boat, in order to save weight. He shouted, "What the hell are you doing?" and told them to put everything back on board. He then proceeded to fill the tanks, and even the bilge with water up to the floorboards. They won the race.
Agree or disagree with Hood's heavy-displacement philosophy, he is not wrong that a heavy boat can sail very well, if properly designed. Capri 22s, on the other hand, are obviously faster when sailed lighter.