The whitewashing is just the tip of the iceberg. It's the "Hollywood-washing" that hurt the movie, of which whitewashing is one aspect.
Seriously, go read the synopsis and watch the trailer for this movie, and then do the same with the original. The former is full of clichés and is a very by-the-numbers revenge story, whereas the latter is mostly about philosophical issues, namely ontology. Something wasn't simply lost in translation, but completely changed and perverted to conform a tired blockbuster formula.
Granted, the movie could never become a huge success if it's true to the source material - Ghost in the Shell was never that big of a success by box office standard, after all -, but then, maybe some things were never meant to be turned into carefully calibrated money machines. Maybe GitS didn't need a live action movie adaptation with that kind of a budget. Or maybe it didn't need a live action movie adaptation at all. Crazy talk, I know.