I don't want to defend Tesla, but ... The problem with LIDAR is a human problem. The real issue that LIDAR has fundamentally different limitations than human sensors have, and this makes any decision based on them extremely unpredictable ... and humans react on predictions.
A LIDAR can get near-exact distances between objects with error margins of something like 0.2%, even 100m away. It takes an absolute expert human to accurately judge distance between themselves and an object even 5 meters away. You can see this in the youtube movies of the "Tesla beep". It used to be the case that if the Tesla autopilot judged a collision between 2 objects inevitable, it had a characteristic beep.
The result was that this beep would go off ... the humans in the car know it means a crash is imminent, but can't tell what's going on, where the crash is going to happen, then 2 seconds "nothing" happens, and then cars crash, usually 20-30 meters in front of the Tesla car. Usually the car then safely stops. Humans report that this is somewhere between creepy and a horror-like situation.
But worse yet is when the reverse happens. Distance judgement is the strength of LIDARs. But they have weaknesses that humans don't have. Angular resolution, especially in 3D. Unlike human eyes, a LIDAR sees nothing in between it's pixels, and because the 3d world is so big even 2 meters away the distance between pixels is already in the multiple cm range. Think of a lidar as a ball with laser beams, infinitely thin, coming out of it. The pixels give you the distance until that laser hits something. Because of how waves work, that means any object that is IN ONE PLANE smaller than 5 centimers is totally invisible to lidar at 2 meters distance. At 10 meters it's already up to over 25 cm. You know what object is smaller than 25 cm in one plane? A human standing up, or walking. Never mind a child. If you look at the sensor data you see them appear and disappear, exactly the way you'd expect sensor noise to act.
You can disguise this limitation by purposefully putting your lidar at an angle, but that angle can't be very big.
The net effect of this limitation is that a LIDAR doesn't miss a small dog at 20 meters distance, but fails to see a child (or anything of roughly a pole shape, like a traffic sign) at 3 to 5 meters distance. The same for things composed of beams without a big reflective surface somewhere ... like a bike. A bike at 5 meters is totally invisible for a LIDAR. Oh and perhaps even worse, a LIDAR just doesn't see cliffs. It doesn't see staircases going down, or that the surface you're on ends somewhere in front of you. It's strange. A LIDAR that can perfectly track every bird, even at a kilometer distance, cannot see a child at 5 meters. Or, when it's about walking robots, LIDAR robots have a very peculiar behavior: they walk into ... an open door, rather than through it 10% of the time. Makes perfect sense if you look at the LIDAR data they see, but very weird when you see it happen.
Worse yet is how humans respond to this. We all know this, but: how does a human react when they're in a queue and the person in front of them (or car in front of their car) stops ... and they cannot tell why it stops? We all know what follows is an immediate and very aggressive reaction. Well, you cannot predict what a lidar sees, so robots with lidars constantly get into that situation. Or, if it's a lidar robot attempting to go through a door, you predict it'll avoid running into anything. Then the robot hits the wood ... and you hit the robot ... and the person behind you hits you.
Humans and lidars don't work well together.