It seems that elitism and anti-Americanism were among the major reasons for the hostility.
It was most likely because it was supposed to be an educational show which was brought to us by the letter 'zee' and the words 'color', 'jello' and 'potato chips'. UK TV companies can hardly be described as anti-American. Indeed, both the BBC and ITV have relied on US TV shows to compliment their schedules for decades. It's far from true the other way around.
Perhaps, but having grown up in a small country, I think it's perfectly natural that children -- even young children -- are exposed to programming from other countries. It makes them realize just how diverse the world is. In the article cited, many people were faulting
Sesame Street
primarily for being American. I consider that a weak argument.
If the few linguistic differences were really such a big deal, the BBC could have launched a UK version of
Sesame Street
. Broadcasters in many other European countries did just that (France's TF1 with
1, rue Sésame
, for instance).
There was also a fair deal of elitism on display. The article mentions that children and their parents rather liked
Sesame Street
, and that most of the opposition came from educators, some of whom considered it "vulgar" (a world popular among cultural elitists of that era). Surely the decision of whether the show was appropriate should have been made by parents and their children?