The situation arose because strangley most of newspapers didn't report the offensive parts of the speech. Rather, the less provocative part was mentioned in the newspapers.
Take the example of Hindustan Times. It mentioned that Varun said if anyone raises a finger at Hindus then I swear on Gita that I will cut the hand. But this is the least of provocative part from his speech.
Even if the correspondents had seen the video footage on any of the channels, they could have realised that Varun had said lot more. The speech was inflammatory because he allegedly used the word 'katua' (circumcised) for Muslims and vowed to kill them.
On murder, rape and cowslaughter
The words could have been replaced by asterixes but the newspapers didn't report this at all, leaving the readers perplexed. Even the next day, HT's senior journalist Shekhar Iyer who covers the BJP beat reported the same sentence without mentioning the inflammatory lines about Muslims and wild charges about rapes of Hindu girls and cowslaughter or the comment regarding Pakistan.
The Times of India was no better. The Hindu was an exception. One reason was that print journalists didn't bother to watch the barely 2.36 minute video clip available on the internet and websites of other news channels. There is another reason.
Excess reliance on news agencies
The reliance on news agencies. The agencies like PTI are always extra cautious. They didn't report the harsh words and the extreme parts about the statement. The desk guys didn't take the trouble to find out more. Neither the reporters did.
As a result the readers who hadn't watched the video on TV channels, couldn't understand why the speech was considered so offensive that everybody was gunning for Gandhi junior and asking for his arrest.