In a press release about it on Citizen Link, we find a signatory saying that
at issue is the watering down of some sexual disorders in an effort to normalize them.
“There are groups out there that are basically sexual-activist groups,” he said. ”They are trying to edit and change perceptions of certain sexual behaviors.”
That includes certain paraphilias, such as Sadism, Masochism and various fetishes.
If you look at the letter itself, they say
Changes to criteria for many of the paraphilias appear to further the states goals of sexual-activist groups that aim at social and legal acceptance for non-normative and disordered sexual behaviors. Namely, we refer to the working group's declaration that paraphilias are not "ipso facto" disorders and the suggested requirement that specified numbers of victims exist before diagnosis.
What they are referring to is the fact that that the Paraphilias Subworkgroup has proposed to require multiple victims before a diagnosis is made, as in the case of Exhibitionism
A. Over a period of at least six months, recurrent and intense sexual fantasies, sexual urges, or sexual behaviors involving the exposure of one’s genitals to an unsuspecting stranger.
B. The person is distressed or impaired by these attractions, or has sought sexual stimulation from exposing the genitals to three or more unsuspecting strangers on separate occasions. 
Background: The reason for this is, essentially, that being diagnosed with one of these can be harmful to the person thus diagnosed; consequently patients often have motivation not to be honest. As a result, some clinicians try guess which patients are acting out of a "paraphilia" or if this is just a one time kind of thing. (For instance, many people who sexually abuse children aren't sexually attracted to children, and many people who are sexually attracted to children never engage in sexual contact with children. The question, then, is how to identify if someone is sexually attracted to children if they deny such attractions. Specifying a number of victims is a way that is being proposed to do that. Another soultion to this problem that some clinicians use is simply to ignore the DSM diagnosis of pedophilia, and treat people convicted of child-molesting the same regardless of whether or not they're sexually attracted to children.
Now the claim that Paraphilias are not ipso facto disorders is a change without substance that the Paraphilias subworkgrouop is making that they're trying to pass off as being progressive. Basically, DSM-IV-TR says that if someone meets Criteria A and B, they have a Paraphilia, which is mental disorder. If they don't meet both, they don't. The Paraphilias subworkgroup is proposing that anyone who meets Criterion A has a paraphilia, and anyone who meets A and B has a Paraphilic Disorder, which is a mental disorder. Thus, anyone who has a Paraphilia, doesn't have a mental disorder! (Which is what the DSM already says...)
The authors of the above quoted letter are objecting to this because they don't want people to have to meet criterion B before saying they have a mental disorder--that is, they're objecting to the status quo, but are pretending to be objecting to this "new" proposal.
I find this--not to mention their comments about gender identity--rather disturbing, especially since this includes someone the Paraphilias Subworkgroup specifically chose as one of their advisors.
I'm also rather curious who these supposed "activist groups" are. A number of organizations representing people in the trans community have been lobbying to get "Transvestic Fetishism" removed, but other than that, I haven't seen any organizations lobbying the APA about the "paraphilias." And I have been looking enough that I'm pretty sure I'd know about them if they existed.