Agreed. She was right and "we" (collectively, the mainstream American audience) was wrong. And yes, I bet mostly that same "we" would now readily admit we should have listened.
Of course, "we" didn't know then what we know now. On top of that, we had just endured a decade of pretty bad popular music, so we were (again, collectively, I think, folks of "a certain age", anyway) especially jaded or suspicious about acceptance of a new pop star. Add ripping up a picture of the pope, and well,...we saw what happened.
What Charmion said above is exactly correct. A thousand times that.
And yes, good on Kris Kristofferson for being kind to her. He's a super-smart forward thinker.
For the record, she was prepared to sing a Dylan song at the tribute concert (I Believe in You; would have probably been great), but was booed so badly she (sort of) sang "War" (as she had done on SNL) in defiance of the audience. The boos, of course, just got louder.
I'm glad she has carried on; I hope she feels somewhat redeemed.