Not sure why George Harrison's kid's work on 8 Diagrams was such a point of contention between RZA and Rae.
The Chef seemed to object more on cultural grounds than aesthetic ones. Saying repeatedly that RZA was on "some hippy shit" did not suggest a wariness of guitar-oriented samples (they've gone there countless times before).
Instead it suggested a fear that the group would be embracing a more effeminate identity, which of course is suicidal within the confines of the genre (and, for that matter, within the confines of most popular music loved by hipsters...a brooding male vocalist with a soft touch is one thing; a dude rockin' a fedora and hoping to be taken seriously by the twenty-something couple gentrifying Brooklyn is quite another).
The whole episode was an interesting fissure in the group, but thankfully all concerned parties appear to have moved on.