Except for the plastic or tar case (which won't be reacting unless there's an arc against it) there's no carbon source handy where the oxygen might be able to react with it. (If it did, it wouldn't stop at monoxide).
But CO detectors are pretty fragile and react in various ways to many chamicals, and ate sensitive to EXTREMELY small numbers of molecules. Some set them off (and generally damage them), others damage them without setting them off. Either makes them useless for their intended purpose.
Meanwhile, a gassing battery has little bubbles popping, and that throws a bunch of stuff into the air: Hydrogen, oxygen, water vapor and tiny droplets, sulphur trioxide, sulphuric acid, maybe a bit of lead sulphate. Extremely low pH. (That's why you get corrosion at the terminals even if you haven't spilled any electrolyte on them.) There's a LOT of sulphuric acid in the battery, so the tiny amount that's lost doesn't bother it in a decade or so of service - though it bothers stuff around it something fierce.
Oxygen wouldn't be a problem, hydrogen I'd guess not. Some of the others might react with the detector - in particular, the sulphuric acid and sulphur oxides.
You've probably damaged the detector. Replace the sensor (if it is replacable) or buy a new one, and mount it as far from the batteries as possible. Vent your battery box to the outdoors.
