Stokes was arrested on suspicion of causing actual bodily harm after a September incident that saw him get involved in a brawl outside a Bristol nightclub.
The Durham all-rounder was later caught on video with footage showing him appearing to throw up to 15 punches and was left with a broken finger after the incident.
He was held overnight before being released but was later suspended indefinitely by England, along with Alex Hales, pending an internal disciplinary procedure that was referred to the Cricket Discipline Commission.
"I can hardly watch the bit at the end, it is horrendous," Pietersen said, as quoted by The Sun.
"I still sort of feel sorry for Stokes and believe [Alex] Hales was just as culpable. The more you watch it, the more shocking it is."
Still under police investigation, Stokes was initially named in England's Ashes squad. However, the most recent development is that the the 26-year-old will not be travelling "at this stage", although no final decision has been made yet.
Pietersen believes the incident makes it hard to justify taking Stokes to Australia and claims factors such as the hostility of the home fans along with the Christchurch native's personality will make the task even harder.
"I have watched it [the incident] with some influential leaders in business and the general view was: 'you cannot represent your country with a video like that going around'," Pietersen explained. "It is a view I agree with.
"Australia is a hostile place and with his personality, at least from what we have seen, I just don't think it will work in Australia. Not this time."
England are due to depart for Australia on 28 October, with the first of five Tests beginning in Brisbane on 23 November.