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Unfortunately, the Goran'Agar Rehabilitation Clinic actually has a very low success rate
(i.postimg.cc)
[Image transcription: A "Doctor's hate him" style meme titled "The Founders HATE Him" about Goran'Agar. The side text reads "He beat his ketracel-white addiction in less than 35 days using this simple trick. FIND OUT HOW"]
It seems like being xenophobic is a deliberate part of his character (look at how he treats Cardassians too); but I am always taken aback when he says something awful, because it feels so out of place in the optimistic future.
Plus, it seems like even the other in-universe characters are bothered by it (Keiko and Dr. Bashir have raised issues with it by the episode I am up to), so it is extra strange that he is "allowed" to just go around being casually xenophobic and hasn't been sent to Federation sensitivity training or something.
The way I read it is miles o'brien is supposed to be the blue collar everyman character that draws in people who don't usually like star trek but they just miss the mark on that often and they make it doubly uncomfortable by also making miles o'brien a very flawed, pretty close minded person which causes cognitive dissonance like you said because all the other characters love him.