From what I understood, after coming to festivals with the masks on the people of Kitakami knew they were the strangers they originally shunned, but they got cool masks now so they're okay now.
What gets me is that, after the Loyal Three, Pokemon that as far as I understand just showed up and never interacted with the village at all, we beaten up by Ogerpon the villagers SOMEHOW made up a story the three were defending the village from Ogerpon (which only seemed to have attacked the three and went away). And then when the Mask Maker, the only true friend the stranger and Ogerpon in the village, tried to explain what happened, the people ridiculed him!
I haven't finished the story yet, but does it mention anywhere the Loyal Three did ANYTHING with the villagers to make them trust them before going to steal Ogerpon's masks? Because the ancient Kitakami people made a huge jump in assuming these random Pokemon Ogerpon went after was protecting them... and then refused to change and fiercely defender their viewpoint.