Why would you think that this company needs to Thought Police their gamers when thousands of others are able to host creativity based games without being dystopian?
When comparing the Minecraft scenario to the AI Dungeon scenario under the purview of "doing creative things with games," I don't find the two scenarios to be much different. However, for one of those things, it's a possibility within the vast play space of Minecraft - you could even create genitalia and display profanity with just alphabet blocks - but for the other scenario, depending on how you see it, it's content that is generated, served, and potentially stored by AI Dungeon. I'd be concerned about the publicity if I was AI Dungeon as well.
Wow. You act as if that's something new :D
There's even an actual job for doing just that: it's called an editor. You know, the people who work in media, publishing houses, TV, radio, papers, magazines, that kind of thing. It's what they do. Everywhere. Editing content. Removing comments, changing words, making sure the views represented in the publication match the intentions and policies of the investors and parent organisations, etc.
You act as if something is new and evil just because it's done with computers. It isn't. It has been the case for as long as papyrus and cave paintings have been around. Back then it was don't anger the chief/king/Pharao, today it's don't anger the Twitter mob or the hand that feeds you. Same difference.
Games are a medium just like magazines or online blogs and comparing blocky dongs in Minecraft with explicit child pornography says a lot about your understanding of "creative expression". Really makes me wonder sometimes.