For decades, educators have written about why "I is for Indian" is inappropriate. While I can't think of a recent alphabet book that has that sort of thing in it, there are older ones that still circulate. One example is Alligators All Around. With the brilliant and beautiful alphabet books published these days, those older ones with stereotypical images of Indians are being displaced. That is progress.
Comment: For more on the subject, see The Best Indian Books.
Below: I is for "Imitating Indians" in Alligators All Around.