Even if it does literally mean 'death to America,' as an American I always interpreted that as being directed at the American government. I never took it personally. Hell, I could probably wear them out complaining about the federal government.
It offends all those who are patriotic to America no matter who or how the government is. Remember this came out in the 70s when the sayings were Love it or Leave it.
Also when the concept is paired with imagery of a Nuclear Iran, you can’t help but feel attacked.
