I think it’s important to not underplay his anti-semitism as I think it’s had a lingering effect on European thought through the centuries. The Nazis used the treatise “On the Jews and Their Lies”(1543) as a key part of their propaganda campaign in the run up to the war and throughout it. Section XI of the treatise urged Christians:
to burn down Jewish synagogues and schools and warn people against them;
to refuse to let Jews own houses among Christians;
for Jewish religious writings to be taken away;
for rabbis to be forbidden to preach;
to not offer protection for Jews on highways;
for usury to be prohibited, and for all silver and gold to be removed, put aside for safekeeping and given back to Jews who truly convert; and
to give young, strong Jews flail, axe, spade, spindle, and let them earn their bread in the sweat of their noses.
The shocking thing is that this is the same man who had written in 1523: “If I had been a Jew and had seen such dolts and blockheads govern and teach the Christian faith, I would sooner have become a hog than a Christian. They have dealt with the Jews as if they were dogs rather than human beings; they have done little else than deride them and seize their property. When they baptize them they show them nothing of Christian doctrine or life, but only subject them to popishness and monkery... If the apostles, who also were Jews, had dealt with us Gentiles as we Gentiles deal with the Jews, there would never have been a Christian among the Gentiles ... When we are inclined to boast of our position [as Christians] we should remember that we are but Gentiles, while the Jews are of the lineage of Christ. We are aliens and in-laws; they are blood relatives, cousins, and brothers of our Lord. Therefore, if one is to boast of flesh and blood the Jews are actually nearer to Christ than we are...If we really want to help them, we must be guided in our dealings with them not by papal law but by the law of Christian love. We must receive them cordially, and permit them to trade and work with us, that they may have occasion and opportunity to associate with us, hear our Christian teaching, and witness our Christian life. If some of them should prove stiff-necked, what of it? After all, we ourselves are not all good Christians either.”
Luther was a great man, but as he aged he grew bitter, jaded and hateful towards Jews and Judaism. I think younger Luther was convinced that the conversion of the Jews was just a matter of time if Christians would just treat them nicely. When he realized they weren’t going to leap into the arms of Jesus any time soon, he started to see them as the enemy.
The younger Martin Luther, attempting to question and persuade, remains a giant figure in Christian thought. The older Martin Luther grew embittered and comfortable in the praises of men and negated a lot of the good he'd done earlier in life. He wasn't the only reformer to fall in this trap.
Just further evidence that power corrupts and absolute power corrupts absolutely.