Should I edit reviewer quotes (typos, etc.) in a response to reviewers?
Put yourself in the editor’s perspective:
They want to go through the reviewer’s points one by one and see whether you addressed them, having the reviewer’s comments available for comparison. They cannot rely on your interpretation of the reviewer’s comments but need to refer to the original. Suppose you misunderstood the reviewer’s intentions at some point. If you distort the quote, this is causing a lot of confusion. At worst, you evoke the appearance of cheating yourself through peer review by tricking the editor into thinking that the reviewer wrote something more benign than they actually did. Even if you make clear that you changed the quotes, this causes extra work as the editor has to refer to the original report when in doubt. (Or they just return it immediately and request that you quote accurately.)
Something similar holds for the reviewer’s perspective. If they get to see your response to them, any misquote may cause confusion or worse. They will probably also not be happy about you nitpicking their language.
The general paradigm of never distorting quotes without marking this applies here as well. And if your quotes of the reviewer are riddled with square brackets, this will arise suspicions.
The only reason where I would change a quote (with a mark) is if the reviewer made an obvious mistake in a reference or quoting your manuscript, where the exactness is crucial to understanding what happened and it would be overkill to write an extra sentence like: “We presume the reviewer meant …”. For example, I once received a minor comment along the lines of this:

Change “stochasticity” to “stochasticity” in line 42.

Taken as it is, this doesn’t make much sense. However, in line 42, I had written “stochastsicity”. Thus my reply went:


Change “stochast[s]icity” to “stochasticity” in line 42.

Fixed.