I had no idea that it was negatively panned. I'm pretty sure that the Muppet Central review at least gave it a good review (I haven't looked at that review in awhile).
Although I haven't watched it very many times, I've always liked this special. There's so much to like about it. It includes appearances by nearly every major Sesame Street character who was part of the show at the time (except for Oscar), a few minor characters pop up as well, it has one of Kermit's last Sesame-related appearances, and we get a good amount of screen time for Frank Oz's characters (though it seems like others did the actual performing... According to Muppet Wiki, Kevin Clash and Steve Whitmire alternated between performing Grover, so I'm not sure if Frank did any actual puppeteering here).
Maybe considering Elmo already had a theatrical movie a year earlier that perhaps giving him a TV movie afterwards might have been a tad much for some.
Actually, Elmo in Grouchland came out the same year (it was two months earlier). And this is a TV special, not a movie.