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We have a .Net component that provides functionality. We have a Restful Web API service that the world will use to call that functionality. We wrote tests that use OWIN to call into our Web API controllers.

In the past, I had always called these "integration tests", because the service is a separate component. However, another developer, who I respect, told me that this is not an integration test, but is instead a "functional test".

I looked at the Defintion of Functional Testing and the definition of Definition of Integration Test and neither one was a clear winner to me for what a test of a RESTful service test should be called.

Is it integration or functional? Are there any authoritative sources that can be used to definitively answer this question (because I don't want my question to be closed for "soliciting debate")?

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Functional testing is a black box exercise, as stated in the Functional testing definition link you posted. This means that the testing occurs without knowledge of the internal workings of the system (such as the code). You would be interested in whether the API works as expected end-to-end; does the user receive the correct response when they use the API? If the REST API is being tested outside of your system then it is a functional test.

If the API is being tested from your code base then this is testing the integration between two or more modules and thus classifies as an integration test. This might involve testing whether a dependent module is sending the correct data, receiving the expected data and in the correct format.

For more information check out anything from ISTQB which is a recognised body for software testing. Here is a link to an ISTQB glossary: https://glossary.istqb.org/en_US/search

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So, can this be considered to be both an integration test and a functional test? From our team's standpoint, we are testing how multiple objects integrate with one another (our service and our internal component). For another team, though, they are testing the functionality of our API, which is functional testing. Have I described it correctly?
That's correct - it depends on the context of the testing.
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When you call a rest service to verify that the service returns what it was designed to return, that is a functional test. You are testing the functionality of the service.

If you had a second service or UI that depended on this service, and your tests interacted with this second service or UI to verify that it can properly call the REST API and consume it's data, that would be an integration test.

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