Why are people afraid of Hannah Tupper in The Witch of Blackbird Pond?

The people of Weathersfield are afraid of Hannah Tupper because they are extremely superstitious people, and Hannah Tupper is different. In general, I think the people are afraid of Hannah Tupper because they do not understand her, and they do not understand her because they make no effort to. Kit makes an effort to befriend the woman, and Kit thinks that Hannah is just fine; however, nobody else bothers to make the effort because they don't see the point.

“But no one in Wethersfield has anything to do with Hannah Tupper.”
“Why on earth not?”
“She is a Quaker.”
“Why is that so dreadful?”
Rachel hesitated. “I can’t tell you exactly. The Quakers are queer stubborn people. They don’t believe in the Sacraments.”
“What difference does that make? She is as kind and good as—as you are, Aunt Rachel. I could swear to it.”

Hannah is a Quaker, and that apparently is so foreign of a way of life that the people of Weathersfield would rather tell scary stories about the old Quaker rather than actually get to know her. For the people of Weathersfield, it is just easier to accept scary stories about Hannah and escalate those stories than it is to try and disprove them. Hannah becomes a self-fulfilling prophecy of sorts, and anything that she does that is "witchlike" just further deepens the people's feelings. Hannah can't even stir a pot without people thinking it might be witchcraft.

Kit looked back at the gray figure bent over a kettle, stirring something with a long stick. Her spine prickled. It might be only soap, of course.

In The Witch of Blackbird Pond, Hannah Tupper is forced to live a life of tremendous isolation, with her cottage located at the edge of the swamp on the outskirts of town.
The people of Wethersfield are afraid of Hannah because she is not like them; Hannah is a Quaker who does not believe in the Sacraments and will not go to the weekly Meetings that the rest of the Puritan community attends.
This fear leads the townspeople to believe Hannah is a witch and ostracize her even more. This tension escalates once a illness begins to afflict the town. Thinking that Hannah's "witchcraft" is the cause of this scourge, a mob burns down Hannah's home in an effort to kill her. She is clearly not a welcome presence in the community.