Feeling sorry for someone and showing empathy are literally the same thing. But you can empathize with someone without condoning their behavior, which is the core of the actual issue.

Despite all the love she received as Tsuyu, Yotsuyu, when faced with the unarmed old couple, chose to murder her “parents” when she could have simply walked away.
And at the end, instead of answering for her crimes and facing justice, Yotsuyu chose to wreak as much havoc as possible.
But she was stopped before she could cause any real damage, and essentially ended up committing suicide via WoL.
This is actually not true. Only Gosetsu was really fully on her side. Hien, Yugiri, and the Scions were largely suspicious of her, and they kept her sequestered because the Domans hated her. She also regained her memories before she murdered her parents, and was about to commit suicide, but she was confronted by her parents who immediately started verbally abusing her and threatening to sell her into prostitution. Also throw in Asahi's manipulations during this.

And I'd like to where you've seen many people saying she did nothing wrong. I mean, I don't doubt there's some, in the same vein that there are people who unironically think Thanos had an altruistic plan or that the Galactic Empire was a peaceful, lawful organization, but I haven't seen widespread whitewashing of her behavior.