Another, according to this Wikipedia entry, was that conditions for getting a government loan forced the company to cut manufacturing costs to the bone, resulting in a cheap looking car. For example, early Henry Js had no trunk opening; one had to open the side door, fold down the rear seat back and then try to maneuver a heavy, cumbersome piece of luggage into place. For not a lot more money, a potential buyer could get a new entry-level Chevrolet, Ford or Plymouth with a trunk lid as standard equipment, more passenger room and other goodies not found on a Henry J.
Henry J styling was what I call cute, and more pleasing than that on many other small cars in the USA and elsewhere at the time. A nice gesture was the small up-kick or micro-tailfin at the rear of the fender line. It served as a counterpoise to the fastback roof line, giving the design some needed balance. Unfortunately, that fastback roof line was going out of style in 1951. Worse, it yielded an inconveniently sized trunk -- the trunk that was difficult to access due to its lack of a lid.
The grille was an oddity -- large, chromed shapes perhaps inspired by squiggly graphics and table tops that were so strangely popular around 1950. Even so, it wasn't really bad. Maybe that's because Kaiser-Frazer had a team of first-rate stylists for a few years, including Buzz Grissinger.
An advertising image showing a Henry with seriously small people.
This publicity photo offers a better sense of scale, though the boy with his hand on the door is pretty small.
More probably small-ish people stuffed into an already small car. In those days, cars of any size were often pictured with small people or people crammed into the passenger compartment to give the illusion that the car was larger than it really was. Note how the flowing fender line adds a touch of grace to what might have become just another slab-sided design.
This was one of the few photos I found on the Internet showing a Henry J with no trunk opening. A trunk lid was quickly added once it became clear that the original configuration was hurting sales. The double-curve at the top of the backlight window echoes window shapes on the new, redesigned Kaisers.