I've been involved in discussions about this. It seems as though it was generally "offensive" as it was a word used by Maori to describe the "other" people on their land. However,the term has now been adopted by these "other" peoples and therefore the offensive element is dropped (people wouldn't want to offend themselves, would they?) Also, the "other" is not just those from Britain. There are migrants from Asia, the Pacific Islands etc.
Because of the range of migrants, Pakeha is no longer used to describe those that are non-Maori but some people of British/European ancestry still identify as Pakeha whereas some do not like the term and prefer "NZ European" or these days, just "NZer". It's all about how you personally identify and saying it's an offensive term may be so for some because they don't identify as Pakeha, whereas those who identify as Pakeha won't find it offensive as they "own" the term. Does that make sense?