Instead of wasting our time bashing the Ulama of Deoband or their opponents, let us rather try to grasp the reason behind the difference of opinion; it will give us some insight into the matter.
Our respected Ulama of Deoband -right from Ml.Gangohi, Ml.Thanwi etc to contemporaries like Mf.Taqi,Mf.Desai etc all oppose celebrating the birth day of Nabi (Sallallahu Alaihi wasallam) -not discussing his seerah, which is what muhannad refers to- for a very simple,easy to understand reason.
According to them, the following principle is accepted:
Any Ibadah not practiced upon in Khairul Quroon (time of Sahabah and Tabi'een) inspite of the Dawaa'ee (motivating factors and reasons) for it to be done being present, then practicing upon such an action would be termed Bidah.
Thus inspite of the great love of the sahabah for Nabi (salalahu Alaihi wasallam) [this is in reality the motivating factor behind mawlid], Sahabah (Radhiallahu Anhum) never practiced the mawlid, thus it is Bidah!.
This usul can be found in Ashraful Jawaab of Ml.Thanwi Pg.81 with full detail and is briefly mentioned in Jawahirul Fiqah of Mufti Shafi Vol.1 Pg.213 with a few Dalail as well.
Now looking through the Fatawa of our Akabir of Deoband, this is as clear as the sun.
The primary reason given by all of them for Mawlid being Bidah, was that Sahabah (Radhialahu Anhu) and the rest in Khairul Quroon never practiced it.
Fatawa Rashidiyyah Pg.112, Ashraful Jawaab Pg.81, Fatawa Rahimiyyah Vol.2 Pg.72-74 . etc
Many Arab Ulama -not all- don't hold the same view. They contend that an ibadah not being practised upon by the Sahabah doesn't mean that is it a bidah. G.f.Haddad defended this in his refutation.
This matter is famously known as "Mas'alah at-Tark" (The Question of that which was left out). Abdullah ibn Siddiq al-Ghumari authored a book named "Husn at-Tafahhum wa ad-Dark li mas'alah at-tark"wherein he contends that Sahabahs leaving it out doesn't render it a bidah.
This is in reality the reason for the difference of opinion.
Now, the question might arise, that when both sides have a sound basis for their arguments and both are of the ahl as-Sunnah why don't they respect each others views and stop making such a big noise about it?
Well, the following reason came to my mind:
Those practising upon it in India were the Barelvis, who were making takfir of the Deobandis, holding many aqa'id contrary to the haq, their moulud gatherings were mixed gatherings full of evil practised with scant regard for salah etc thus instead of accepting these gathering as having some basis in shairah, they completely opposed them.
As for the Arab Ulama, they were faced by hardline wahabis firing their automatic weapons of "Shirk" and "Kufr" at anything that moved, thus they labeled the opponents of moulud as those who hold no love for Nabi (sallallahu Alaihi wasallam).
In my weak opinion, if the Arab Ulama had to be asked regarding the Deobandi stance or vice versa, they would have said that while we don't agree with them, it is an acceptable view, just as we say regarding other mazahib.
My sincere advice to all is to follow the Mufti who rely on, without attacking those who hold a view contrary to yours, rather try to understand why he is saying it.
P.S. Maybe those with contact with Hamza Yusuf or others who have studied in Mauritania should ask them what is the opinion of his teachers (Murabit al-Haj, Had Amin etc) regarding it. If I am not mistaken, they completely oppose it, even if no other evils are found in it. I have found them to be extremly similar to the Ulama of Deoband in many aspects, I think this is also from amongst them.
And Allah taala knows best