He isn't gay, most likely bisexual according to the scenester gossip in Omaha. The big rumor is that all the talent of Saddle Creek has had some sort of sexual involvement with each other. As of late, I have only seen Oberst making out with Maria Taylor of Azure Ray at various shows when he is in town. I have heard they have an on again off again romance going.
As for my local take on the indie rock community bashing him. He went to a renowned Prep School in Omaha, his parents are fairly well off and are still together. He presents himself as a tortured soul and moves to NYC once he gets some notoriety. The new Bob Dylan thing is always an annoyance, wasn't Ryan Adams given that title at one point too.
I also think the twentysomething indie rock hipster males are mad that the teenie girl hipsters worship this guy. More power to the girls, but I also don't get being gaga over a 5"8" 130 something pound guy with a squeaky voice.