I didn't and wouldn't have backed Unstable Diffusion, but people were willing to spend money on it, it seems clearly legal from our current understanding, and there's nothing in the Kickstarter that suggests it's malicious or would otherwise violate any ToS or guidelines; in fact the campaign seems careful to suggest that they were intentionally aiming on making it difficult to abuse, which I know people have feelings about here too, but the point is that this seems like a textbook example of a project that dotted its I's and crossed its T's.
But some people didn't like it, I assume, and therefore they had to find a reason it violated their guidelines and shut it down.
I know that objectivity and neutrality are no longer hot concepts, and I also understand that not everything from the way things "used" to run would still work today, but I can't help but feel this was just a completely unnecessary concession that helps nobody. Crowdfunding was supposed to empower people to directly support things that they wanted to see, but when it goes through gatekeepers like Kickstarter and Gofundme, they become the ones with all of the power to decide what things are allowed.
I think it's probably all moot. Nobody would defend a campaign like this anyways, so trying to make the case that this is a(nother) bad precedent is impossible. People just simply don't give a shit anymore.