This is a violation of people’s freedom of religion, although it occurs to me that childish stupidity and alcohol are more likely culprits than the prince of darkness.
Is the priest, though, correct from the point of view of Catholic teaching about the veneration of statues?
Surely he has misspoken, or been misquoted. He can’t really believe that the Blessed Mother has done anything ‘in the form of that image’. Can he?
If you mean does he think Mary came down from heaven and was present in that statue, no, he does not.
For Catholics, as with the case in all statues, looking at them ‘recalls’ the presence of the given person and is a tangible reminder that they are ‘watching out for us’ through our Lord Jesus Christ in heaven. This statue’s presence over those years has been a reminder of Our Lady’s love and protection of all, especially those in that parish, during that time.
It is true that “Catholic shorthand” can be hard for non Catholics to understand.
Because we know that statues are representatives of the ‘real thing’, it is the 'real thing REPRESENTED BY the statue which we honor, not the statue itself.
Because the people of the parish were able to look at the statue which represented our Lady all those years, they had a tangible reminder each time of Mary’s ‘watch’ over them through Jesus Christ. It was the form of that statue which reminded them in a physical way, though we are quite capable of thinking of Christ and the saints without any statues, and it was not simply that particular statue of Mary which would have made people think. There are many statues of the saints throughout the world so it’s not as though Mary was only represented by this one statue. However, it was the statue that this parish had commissioned, installed, seen and known for many many years. It was a loving commemoration meant to bring a visible reminder of Mary, mother of our Lord and Savior.