Yes, sounds like your poppy seeds went rancid. Poppy seeds are very high in oil and, though manufacturers don't label the product properly, they should be stored in the freezer if you don't use them frequently (they'll keep up to 6 months if packaged properly). While your taste test of the batter seemed fine the rancid oil was, looking for a good descriptive, 'bloomed' by the heat and would account for the differences in taste test.

It also could be too much baking soda or baking powder. I’ve run into recipes that accidentally call for tablespoons instead of teaspoons, and one tablespoon too much of baking soda/powder will make baked goods so bitter they are inedible.

Typically, you’d notice this if you tasted the batter, though, so it’s probably the seeds. But you never know.

Pith from the lemons.

My guess would be zesting too far down on the lemon and integrating the white part into the mixture. That has a tendency to be really bitter.

I agree with Rucy, but if that doesn't work, I have noticed that sometimes flavours go away after being baked, I would add a vanilla extract to it, or if your can find a lemon extract, that would work better.

I don't think that rancid is the same as bitter, I'm with the zest people---don't put the white part in even a tiny amount---ideally use a microplane grater.

totally agree on the zest. i have ruined baked goods by doing so too. :/ it sucks...but lesson learned!