I think it's more complicated than that. Let me start from the top.
I think it's important to frame the discussion from the perspective of normal, everyday people (normies). To a normie, sexualizing a cartoon horse for children is already completely beyond the pale. To them, it doesn't matter whether the cartoon horse is being raped, or if they've over the age of consent, or whatever else. Whatever fetish you tack on is just the icing on the cake. Let's call this "fringe content".
Now, there's a very strong argument that art can be used to explore sensitive topics. That's why I'm in favour of freedom of expression. But art can be interpreted and enjoyed many ways, for many different reasons. Take rape art, for example. Maybe someone has a rape fantasy, and they want to use art to explore it from the perspective of the victim. But that same piece of art could also be enjoyed by someone who fantasizes about being the rapist. Someone else might take the picture as commentary on how horrible the act is, while someone else might like the idea of the victim "knowing their place".
Obviously, the site is free to ban or allow whatever they want for whatever reason they want. Despite opposing censorship, I genuinely believe that the stance of "We don't have to justify our content rules, filter or GTFO" is the reason the site worked so well. Especially considering that the decision to ban one thing kicked off a civil war that very nearly destroyed the site. It is also my belief that if you make the decision to host "fringe content", you kind of have to agree to not pass moral judgement on whatever you do
allow. I felt like there was an "honour among degenerates", and that by using the site in the first place, you left any claims to a moral high ground at the door.
Their mistake wasn't in banning or not banning. It was in opening up the discussion on what should or shouldn't be banned in the first place. Because once you're in the realm of "fringe content", there really is no moral or logical argument for banning one thing but not another. So, I think any changes to what is allowed must be made only out of absolute necessity. Because when you ban something because you find it "immoral", it re-contextualizes
the decision to allow the rest of the "fringe content". So you open yourself up to people complaining about other "immoral fringe content".
TL;DR: I don't really care what you host, but every change to what's allowed sends shockwaves through the community, so decide where the line is, and don't move it unless you absolutely have to.