> You see some very sexually explicit titles on steam but then again even relatively harmless stuff can get you flagged. This creates an insecure situation for devs in certain niches and not just erotic. For example Visual Novels can be easily flagged for having a certain art style.

This seems a lot like intentional obfuscation of precisely what that "relatively harmless stuff" or "certain art style" is because you know it's going to sound a whole lot worse if you actually explain it.

I'm fairly pretty sure the actual answer here as to what's likely to get you flagged is: "drawn/animated characters that look like children in explicit or highly suggestive settings", maybe with the lip service of calling them 18 in text, maybe not.

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That content is in a legally risky area of it's own AFAIK and is a massive political/PR risk in a way that other content is not.