Victor Lieberman is the world's leading historian of Burma, so it seems more than fitting to talk about his views in his review, "A zone of refuge in Southeast Asia? Reconceptualizing interior spaces."

Virtues, per Lieberman:

• Despite the large number of books on state-building, Art is the first real book to discuss statelessness in Southeast Asia. "Scott’s central achievement, then, is to bring hill peoples into the mainstream of regional history by uncovering their relation to lowland states and societies [...] he is the first to offer a regional overview." The writers write history, as somebody said, and in Southeast Asia the writers have been overwhelmingly those steeped in lowland traditions. Scott thus offers a correction to those who see only the lowland side of mainland Southeast Asia's history.
• Lieberman also praises Scott's global reach, something he is known for himself; "Scott alone has analysed external state-repelling, and internal state-avoiding, strategies as generic phenomena characteristic of frontiers around the globe." This global application of his thesis has made Scott's work

However, Lieberman spends more of his review criticizing (sometimes harshly) the book.

• Lieberman rightfully points out that Scott relies on no Burmese sources, or at least so close to none that it doesn't really matter. His notes do not contain a single citation from an untranslated Burmese source (even though Scott apparently knows at least some Burmese, making the situation even stranger). Scott uses a few English translations of Burmese sources, but sometimes rather badly (citing the 19th-century Glass Palace Chronicle as a source for 13th century Bagan!). As someone very experienced with Burmese sources, you can sense Lieberman's frustration when he writes, "Scott's treatment of the state is linked to his claim -astounding for someone unfamiliar with Burmese-language documents – that Burmese royal records were 'strong on dynastic self-idealization and weak on hard information.' Not only does he misinterpret royal chronicles but he ignores resource inventories, local inquests, law codes,legal rulings, imperial geographies, commercial contracts, and local histories, most of which were no less sober historical documents than their early modern European counterparts."
  • Tied to his apparent unwillingness to rely on local sources, Scott makes basic errors. This includes conflating terms from two unrelated languages (Shan and Burmese), claiming that literacy rates in the lowland societies around Zomia "were confined to a miniscule portion of the population, almost certainly less than 1 percent" (very high literacy rates in precolonial Burma is well-attested, and in China or Thailand as well, literacy rates were an order of magnitude larger), claiming Ava (and not Taungoo and Pegu) was the capital of Burma during the First Taungoo era, etc.
• More seriously, Lieberman also accuses Scott of holding "an Orientalist, dismissive view of the indigenous state, denying it a linear institutional dynamic and reversing the proper relation between regna and interregna." Lieberman believes that Scott's statements that Southeast Asia was largely absent "even of valley states," that Southeast Asian states were "unable systematically to extract resources," and that interregna "were more protracted than regna" are all unsubstantiable. In sum, Scott "strives, with sensitivity and sympathy, to introduce agency, nuance, and contingency to the history of hill peoples; for their putative nemesis, the lowland state, however, he performs no similar service."
• Lieberman also attacks Scott's overfocus on manpower. He points out that it is objectively false that states like Melaka yielded to "more manpower-heavy agrarian states" (Melaka was succeeded by three Malay states fundamentally similar to its predecessor), and that the Nguyen state of Central Vietnam could rely on maritime resources to thwart the invasions of its northern neighbor, although North Vietnam had almost ten times the population of the Nguyen realm. Ultimately Vietnam was reunited by the Tayson, from the least populated area of the country, the south. And far from states needing constant influx of population, "imperial collapse on the mainland frequently reflected not loss of population but rather overpopulation relative to land."
• Most importantly, "Evidence for massive, sustained flight from the lowlands to Zomia is thin. Evidence for deportations from Zomia to the lowlands is better, but still limited. And the implications of both types of displacement are ambiguous." Until the 19th century refugees from the Chinese empire made up a significantly smaller proportion of the uplander population than now, and after listing examples of flight from the lowlands to the highlands, Lieberman remarks that "all in all, outside central Vietnam perhaps, this remains a rather limited record of displacement and flight." Lieberman does note the substantial evidence of lowland attacks on the highlands but adds the qualification that such invasions are only rarely found in Burma, suggesting that these were caused by contingencies rather than a fundamental imperative.
• I will just quote his final argument. "But the larger problem is this: Scott’s explanatory dynamic neglects the hills themselves. The great virtue of his book is its unification of lowland and upland history through a lowland-focused developmental model. Its principal weakness, in my view,is the flip side of that strength, namely, its relentless lowland-centred monocausality and functionalism.Scott sees virtually all highland behaviour – physical dispersion, economic routines, statelessness, ethnic fluidity, oral illiterate culture –through the prism of lowland state oppression. As the book’s subtitle advertises, his is an anarchist, anti-state history.But this means that ecological and cultural conditions that were intrinsic to the hills and that were substantially or completely divorced from the valleys receive little or no attention. Therein lies a certain irony. Scott implicitly applauds the uplanders’ urge to freedom from valley domination. But in tightly tethering hill society to a lowland-centred dynamic,he robs that society of functional independence." He points out that New Guinean and inland Borneo societies shared many cultural traits with Zomians, even though indigenous states in Borneo were much weaker than in Indochina and most of New Guinea had no state until the late 19th century.

In sum, it's a controversial, divisive book and should be read as such. Also see this thread featuring /u/Keyilan, /u/Tiako, and /u/Lich-su.