It depends on the product placement and usage. It's relative. In some in-game settings real-world ads are not out of place and are not shoved in your face. In others, it seems a little forced and overly commercialized for a product you've already paid a large chunk of money for.
Which I think, is what may offend many people subconsciously: this isn't like broadcast television where you watch for free and accept ad breaks. It's a bit more like buying a DVD of a movie and having increasing amounts of obnoxious start-up ads on the disc, or worse: imagine buying a DVD and having ad breaks during the movie? People are annoyed at the prospect of commercialism gone mad, because advertisers see video games as a plump, unpicked field ripe for exploitation.