The branches fell onto spectators watching below.
Ten people on the ground were injured.
"It was like a storm of sand and garbage and people running," said Ann Hirsch, 66, of Staten Island. "Branches just came down. They were all over the park. ... It was really scary."
Firefighters say seven people were taken to Richmond University Medical Center, and later released. Three others refused medical attention.
"When it came in it created a tremendous downwash, and the people that were standing under the trees were knocked down," said Deputy Fire Chief Roger Sackowich.
A joint venture of Boeing Co. and Textron Inc.'s Bell Helicopter, the V-22 is designed to carry 24 combat troops and fly twice as fast as the Vietnam War-era assault helicopters it was designed to replace.
The Osprey program was nearly scrapped after a history of mechanical failures and two test crashes that killed 23 Marines in 2000. But development continued, and the aircraft have been deployed to Iraq.
While the General Accounting Office questioned the V-22's performance in a report last year, the Marine Corps has called it effective.
Monday's demonstration was part of Fleet Week, an annual military showcase in New York.
(The Associated Press contributed to this report)
