What's wrong with subtitles for a Czech movie, as referenced in Tootsie?

I don't think it's a Czech-specific quip, actually.

I believe the idea is that the lines are crude and not very intelligently written, as if someone were translating actual decent dialogue from a language they have poor command of, making the translation very rudimentary and child-like. Or possibly, if there was not a robust movie industry in that nation in the early 1980s, the quality of the output was considered pretty poor. Or some combination of the two.

So, languages that were pretty common in the "western" and US part of the world would not work, even if the country was not really familiar (where the language was Spanish, French, German or Italian) or if there were not examples of any movies from a country. Portuguese? Maybe, but a Slavic or Balkan nation or language would be ideal for that line. Probably not Poland, because there was already a Polish stereotype about intelligence that was commonly used in jokes, so there might be some confusion about intent.

"Czech" was merely chosen because it's a country an English speaking audience would be aware of, but there would be almost no movies, as of that time, that anyone could reference, making it an obscure scenario.

They could have easily used Romania, Bulgaria, but could not use Latvia, Estonia, Ukraine, etc (nations that were, at that time, considered part of the USSR).