Why did Peter Brook’s production of The Mahabharata offend some critics and audiences?

Peter Brook released his production of the Hindu epic in the U.S., although the French restaged it multiple times. Brook was already a well established master of contemporary theater whose work drew on multicultural sources. For the first time, however, he completely re-interpreted an established, foundational work of an Asian culture.
Both the script and production, as well as Brook's explanations, drew criticism. He seemed almost unaware that the idea of appropriation existed, justifying his choices by referring to his extensive knowledge gained by travel.
The script was developed by a French writer with little direct input from Indian professionals. The basic decision to condense multiple volumes into a shorter work was also problematic, though some complained it was bad theater because it was too long, running 8 to 11 hours.
Frank Rich in the New York York Times (October 19, 1987) found fault with the oversimplified content in combination with overcomplicated staging, as performed in New York. He thought that the essential importance, which was primarily its "moral substance" had been boiled down to superficial sermons and homilies that Western audiences might digest, and could not capture any "enigmatic Hindu concept." The idea of universalism he also found forced, as complexity was "watered down to knock international audiences over the head." On the production itself, he was the harshest, calling the techniques a "smorgasbord of Oriental stagecraft."
https://www.nytimes.com/1987/10/19/theater/stage-from-brook-the-mahabharata.html

The main criticism leveled against Peter Brook's 1985 production of The Mahabharata is that it was culturally appropriative and orientalist.
The play, written by Jean-Claude Carriere, a Frenchman, and staged by Brook, an Englishman, takes for its source material the Sanskrit epic of the same name. Critics of the play found its treatment of Indian myth to be reductive and offensive, while others, including the New York Times review from the time, praised Brook for making the stories accessible across cultures.
Cultural appropriation is a sociological concept defined as a dominant culture adopting elements of a minority culture. It's easy to see why one might accuse Brook of cultural appropriation for his portrayal of Indian culture that was designed for a Western audience and told through his Western lens.