To add to your post about how people wouldn't have made much of a ruckus about this back then, I think there's some more context to it.
This product came out at a time when people didn't protest this stuff publicly much. A lot of US Boomers had turned 30, had a mortgage and kids, and stopped being hippie protesters and had turned conservative. Boomers of the time, liberal and conservative, still strongly disapproved of racism, and would oppose hate crimes, but on a personal level. They would not go out and "make a statement" or protest, unless something really egregious happened.
It was a different time because they didn't have communications technology: there was no social media. If you read "Orcs of Thar" in a bookstore and found it offensive, you might tell a friend in person, refuse to buy it for your kid (the most likely result) or write TSR directly, but there was no internet to reach a wider audience. There was no twitter to use as a personal megaphone to raise awareness, almost no email, and no quick way to organize groups of like minded people. You needed to contact a dedicated protest group by landline or snail mail to organize something. It's easy for us now, but back then, you needed lots of money and energy to organize a boycott.
That's a major reason people in the 80s didn't protest this--most had no clue it existed and unless you really cared about it, it wasn't worth the sacrifices to money and family you'd have to make.