The more I think about this, the more I think it's going to ruin it. Dang it! You just know it's going to go that way. Like Apollo alluded to, everything now has to be "PC". Anything, everything and anyone in Hollywood and in the public gets offended easily. D@mned if they do and d@nmed if they don't, they will not win either way. They will offend the dwarfs and non dwarfs if they don't cast them, and if they do cast them, they will offend everyone else for stereo typing. God forbid there be an Asian dwarf or a Hispanic dwarf, all heck will break loose, and the complete opposite will happen if it's an all white cast claiming its whitewashed. See where I'm going with this? Somewhere at some point people are going to complain, I think you're 100% right more than you know given how things are in the world today. OK, off my soapbox for today...carry on
Trying to make Time Bandits into a TV series might be cool, because they can time-jump to a different place and time each week. Of course, it will never be as quirky and wonderful as the movie. When I had a video studio in the 80s, I would run TB every morning to warm up the equipment for the day. I never got tired of watching.
I see this having great potential, but what do I know? I tried pitching a Bill and Ted live action series in the 90's. They actually considered it! But in the end, they felt if it didn't have the Reeves/Winters combo it wouldn't work.
I personally feel that anything that works with time travel is solid entertainment. The possibilities are endless.