@Alexandrious947
https://www.justice.gov/osg/brief/ashcroft-v-free-speech-coalition-merits
This Supreme Court Case asked the following question:
The Child Pornography Prevention Act of 1996 (CPPA), prohibits, inter alia, the shipment, distribution, receipt, reproduction, sale, or possession of any visual depiction that "appears to be[] of a minor engaging in sexually explicit conduct." 18 U.S.C. 2252A, 2256(8)(B) (Supp. V 1999). It also contains a similar prohibition concerning any visual depiction that is "advertised, promoted, presented, described, or distributed in such a manner that conveys the impression that the material is or contains a visual depiction of a minor engaging in sexually explicit conduct." 18 U.S.C. 2252A, 2256(8)(D) (Supp. V 1999). The question presented is whether those prohibitions violate the First Amendment to the Constitution.
It part of its ruling, it stated:
The Act does not cover drawings, cartoons, sculptures, and paintings that depict youthful-looking persons in sexual poses; it supplies an affirmative defense to persons who disseminate visual depictions involving adults who may appear to be children, provided that the depictions are not promoted or presented as child pornography, 18 U.S.C. 2252A(c) (Supp. V 1999)
Based on this, there is legal precedent under US law for PSO2 to be able to remove its censorships as it does not promote nor present itself as child pornography. This is a legal precedent set forth by a Supreme Court case.
In regards to your reference to 18 U.S. Code § 1466A. It states:
Any person who, in a circumstance described in subsection (d), knowingly produces, distributes, receives, or possesses with intent to distribute
This means there must actually be an intent behind to create and distribute child pornography. Sega would not be a person that knowingly produces or has an intent to produce child pornography.
Not to mention, there are precedents set by other games that are far more explicit that go by uncensored, such as Senran Kagura.
The fact is, the game does not need censors and would not violate US law if it did remove censors. The idea that the content violates US law has been debunked many times in this thread and other threads.
The PSO2 video you posted would cause Youtube to run afoul of the law if said content was against the law, as Youtube is owned by a US company, Google, and they can be considered to be distributing the video on their platform.
The cutscene I have linked in my signature, if that was illegal, Sega would have already been sued. The files for it are in the game. Meaning the games download would be distributing the content. Even if something is not accessible through normal gameplay, it is still considered part of the game's content if it is in the game's files; an example of this would be GTA San Andreas and the hot coffee mod.
It is very clear that US Law is not the issue with the censored content. Paranoia of Western Cancel Culture is the more likely culprit.