Why did the optical spectra of quasars initially seem so mysterious, b4 the correct interpretation was made?

Answer 1

Because they exhibited ENORMOUS red shifts, implying huge distances from us. At those distances, it was inconceivable that they were stars, which was the earlier interpretation. They were then renames quasi-stellar objects, or quasars for short. Now, current theory holds that they are the nuclei of some of the earliest formed galaxies.

Answer 2

They were mysterious because, unlike normal stars, quasars show lots of emission lines and broad absorption lines.