As a non US citizen, could someone explain why is there such a furore over the location of the terrorist trial?

Because people are thinking with their reptilian brains instead with their frontal cortices (as Dan Quayle said, "What a terrible waste, to lose ones mind"...;-D...).

There is nothing inherently wrong with holding the trials in New York City. I assume the judges, court personnel, and law enforcement officers there are as competent as most anywhere.

But the symbolism of it upsets a lot of people.

I think the Obama administration should have anticipated this and chosen another venue.

Maybe they ultimately will. Perhaps the announcement that the prosecutions will be in New York is a 'trial balloon' to see what the reaction would be.

Political opportunism. Anything to bash Obama.

They've had 8 years to hold military tribunals, they chose not to.

Technically if you commit a crime in a particular locality, you're supposed to be tried there.

The main reason is "Discovery" Which gives the defendant the right to the documentation to which he is being prosecuted, in this case would include a large amount of intelligence material. This kind of information would not become public in a Military trial so that is why so many are upset at the idea of a New York trial. Another reason is, that New York can't afford to pay for the huge amount of security that would be needed to protect the defendants and everyone involved right now.

Plus, the terrorists attacked New York, now they're getting a civilian trial there and it's somewhat unlikely they'll get the death penalty.

Location of the trial is a big deal because every state has a different set of laws. Like some states have the death penalty while others do not.

Different laws in different states like the death penalty