I don't think any explanation is needed, as I don't think the antisemitism angle is played up in the musical as it is in the book and the stage play/movie, so there's no great discrepancy. Indeed, Mame's big revenge on the Upsons isn't locating a home for Jewish refugee children next door to them (and yes, you can unpack the politics of that, if you need more to be woke over--placing those poor kids who have been through so much amidst violently hostile neighbors, just so Mame can score a bitchy victory). Instead, she plans to open a home for unwed mothers.
It may be worth pointing out what actually happens in the earlier versions. The Upsons are vocal bigots and, in the novel not only does Mr. Upson join his family in not wanting Jews in their suburb but agrees with Hitler about the Final Solution. In contrast, not one Southerner in the book ever expresses any racial views or anything but the most benign cliches about Northerners vs. Southerners or respect for Confederate generals; thus, there's nothing for Mame to be offended by or react against.
And of course, Mame loves fantasy. She redecorates her home to fit whatever fantasy she wants. She's spent some time in the novel prior to Patrick meeting her playing at being Spanish, and when he first meets her, she's playing at being Chinese. Playing Southern belle for a time is just one more costume, one more momentary diversion for her. Late in the novel and book, she'll play at being Indian. She doesn't take any of it, or much of life, that seriously. It's a series of costumes to adopt for a time, to enjoy and discard. That's what's fun and eccentric about her.
Once again, this is fantasy. There are plenty of people who have supported liberal causes and insisted on the equality of the races who have loved the story of Auntie Mame in all its forms. Because they realized the difference between fiction and reality and between imaginary worlds and social realities. Yes, it was unusual and terrific for a comedy that Mame stands up to anti-semitism. But that she hadn't earlier in the evening (or book) stood up to (a never demonstrated) racism didn't matter to the audience because they knew they were watching/reading a lightweight comedy and didn't expect it. No one was looking for consistency or "truth" about important social issues in the character of Mame Dennis. That isn't what she existed for.
The inability of Millennials, and possibly (but I'm not at all sure) members of Gen Z, to grasp this, and somehow feel, not only offended, but threatened by a piece of lightweight entertainment, is just a storm we'll have to weather online until saner minds prevail again.
I doubt Mame is going anywhere. I knew it from my childhood, and by the time I was an adult had started to think of it as an old chestnut, but decade after decade I've seen the musical staged to acclaim across the country. I was surprised in my mid-30's and 40's to keep finding gay men just discovering and falling in love with the novel and the movie. It seems to be evergreen. If it isn't going to be staged right now, I suspect that has less to do with how the general public would respond to it than with producers fretting over some loud voices on the internet at this moment.
