I find it interesting that you mention this offhand because I've been very seriously noticing this type of prudishness in a lot of gen z and younger gen y people and its begining to manifest as old style homophobia
I should add that I'm not quite sure exactly how the trend of homophobia that you speak of is hitting younger people. I haven't noticed a shift backwards in real life or on-line. If you're referring to social media homophobia you should realize that "zoomer humor" is radically different from typical humor and many kids will sound like a deranged homophobes/racists/sexists until you realize that they themselves are gay/black/female and are making jokes at their own expense. That being said, ask before assuming they are or aren't joking.
[0] - I'm not sure about the legitimacy of Slate as a publication but a brief skim of this article makes me think it hits on everything relevant in the controversy (if you don't already know about it; it's semi-common knowledge nowadays): https://slate.com/human-interest/2020/06/jk-rowling-trans-me...