It's not the pachinko machines themselves, but everything around them.
It all began with a Silent Hills, a collaboration between game designer Kojima, film maker Del Toro and body horror artist Jinji Ito being cancelled for unknown reasons.
Business is business, so most have let it slide. However, then the letters came. Anonymous letters from Konami employees describing physical and mental abuse, as well as complete disregard for their work. Industry veterans that helped establish the medium the way it is today quit after being demoted to cleaning toilets. There was a line of other nasty claims, but that is a completely different story.
That and Konami withdrawing from western stock markets made the populus raise their collective eyebrow at what was happening. It was later confirmed that Kojima had to quit following legal and mental abuse from the board of directors. Konami probably noticed the negative PR it was gathering and tried to perform some damage control by claiming that everything is alright.
Sadly for them, more employees spoke out for Kojima. A storm was brewing.
On april 25'th 2015 independent journalist George Wiedman, known as Super Bunny Hop on Youtube uploaded a video speculating about the corporate issues that Konami faced at the time.
https://www.youtube.com/watch?v=iMK-kajdgMA [/youtube]
Seven hours after the video was posted, it was taken down by Konami for "showing a few seconds of Metal Gear Rising footage". By that point most of the gaming press stood up for George and stated their direct critisism of Konami. Five hours after the takedown, the video was reinstalled.
The next day, Konami showed their trailer for a Silent Hill pachinko machine, which was reposted of various gaming news sites and used as an outlet for all the negative press. I clearly remember the top comment being Jim Sterling saying "#FucKonami"
The final part in the scandal was the statement by Hideo Kojima's Konami representative that he won't be allowed to visit that year's Video Game Award ceremony because the executives didn't want him recieving the award for him latest game. After the annoucer stated that, the crowd started booing Konami.
Basically, that summs up the saga. It's not that people have problem with pachinkos, but rather what they represent.