This isn't true. Nirvana wasn't considered a sell out until post nevermind. The reason being is that they had a big studio album, produced by Butch Vig. The sound was a big departure from their diy attitude and pixie rip offs. A few years prior, they did a split 7 inch with the Jesus Lizard, indie royalty from Chicago on Touch and Go. Added to this, was the leap from Sub Pop to Geffen records, where the band shit on Sub Pop. This is why people from the punk/indie scene didn't care for nirvana. Hell, they played Cahoots in Louisville in 90 on the Bleach tour, so they were well known then.
Also, after NM, when recording in Utero, they went to Steve Albini to produce and record. Albini is considered an Indie God, with being in Big Black and Shellac. He gained notoriety from producing Pixies Surferosa and a Bush album. I think even a robert plant album. His rawness in recording and simplicity made artist come to him. Well once, nirvana had in Utero recorded, they had the hit singles like all apologies, heart shaped box re recorded to sound more polished like nevermind.
They weren't considered sell outs before. And even Cobain said he ripped off smells like teen spirit from the pixies.