From Harper Lee's own words, "She tells Caufield that Esquire has turned down an article she submitted (Go Set a Watchman) because, she says, the editor did not believe that there were segregationists who also despised the Ku Klux Klan. “This is an axiomatic impossibility, according to Esquire!” she writes. “I wanted to say that according to those lights, nine-tenths of the South is an axiomatic impossibility.” http://www.newyorker.com/magazine/2015/06/08/yours-truly
Then, she wrote "To Kill a Mockingbird", and it was accepted for publication by HarperCollins.
The way I read the account from an editor involved with the original goes something like this:
Harper/Collins received her submission of Go Set a Watchman and advised he that they could not publish it but if she submitted a work framing the characters earlier in their timeline it might be more appealing.
She re-wrote the story as TKAMB and placed her characters in the earlier part of her fictional chain of events and it was published as a success. The original Watchman manuscript was filed away and forgotten.
What we now see published was her first attempt at the novelized world she lived in and her view of it.
What we have is the controversy that these characters were sainted and instead, in her fictional world, they were real and people of their times.