I live two blocks from this area. The concern many in the neighborhood have goes something like this. The city is viewed to be deep in the pockets of developers, who cash in on valuable public lands but put no effort towards supporting new or improved infrastructure.
So, a new housing project will be built into Magnolia. There are currently only 3 bridges that connect Magnolia to the city. One of those bridges - The Magnolia Bridge - is falling apart and the city says they don't have the funds to repair it. This would lead many to assume it will be demolished at some stage in the near future (hopefully they aren't waiting for tragedy to strike first). Even without the new housing project, squeezing the population from 3 bridges down to two would be a nightmare. Add hundreds of families into an already crowded peninsula and the lack of that 3rd bridge is hard to fathom.
Not to mention Magnolia was bypassed for easy access to the future light rail, too (which we also pay for).
So yes, build more housing even if that means Discovery Park, one of the crown jewels of Seattle, will get filled with more humanity. But at least invest in the infrastructure and schools in a more balanced way to support all of those new folks and the ones who live here.
You can probably imagine why tempers are rising.