I saw this on Boingboing and came up with a resounding WTF?

I play WoW when I can. My school connection is awful, so I don't get many chances during the semester, but the game is a setting that I am familiar with. I fully agree with John Blatzheim that Blizzard is establishing a double standard. I hear people over public chats frequently tossing the terms "fag" and "gay" around in distinctly offensive contexts. Not only that, but the company's interpretation of their own code of conduct is boggling to me. The precise text bans "both clear and masked language and/or links to websites containing such language or images which:
Insultingly refer to any aspect of sexual orientation pertaining to themselves or other players."

Since when does "GLBT-friendly" insult anyone's sexual orientation? The only possibly way I can imagine that the phrase in question could be construed in such a way is by operating under the assumption that the word "gay" must always be used in the context of a homophobic slur. That assumption is equivalent to suggesting that noone can ever use terms such as "African" or "male" without insulting somebody who might possibly take the word far, far out of context and feel insulted that someone used a term that describes them or someone else in a derogatory way. On top of this, Blizzard is quoted as saying "Many people are insulted just at the word 'homosexual' or any other word referring to sexual orientation." Apparently, Blizzard holds the concerns of people who are offended by any reference at all to sexual orientation of any kind (which is NOT listed in the terms of use) over the concerns of people who want to express either their own personal identity or role-play something different. "We have determined that advertising sexual orientation is not appropriate for the high fantasy setting of the World of Warcraft and is therefore not permitted." I'm not sure where Blizzard got this idea. How does creating a character who has any sexual orientation whatsoever not fit into fantasy? Especially when the vast majority of the female characters in the game (at least, the ones designed to look even vaguely humanoid) are designed graphically to be stereotypically idealized and often provocatively clad? And why have the numerous players who I've seen design female characters only to run around the game in their underwear not been penalized? Because they can be as sexuallly provocative as they want as long as they don't say whether or not they're interested in males or females or both?

I have written this post in a mild fit of temper, and it's quite possible that my arguments are not as deeply researched as might be optimal or as strong as I have made them out to be. I freely admit that I might be overlooking some point of view or another, and I welcome anyone to chime in on this issue. In the meantime, I will keep investigating this issue. I have enjoyed all of the games they have released for my platform (with the exceptions of the original Warcraft and Diablo), and I have up to this point held a positive opinion of the company. I hope to regain that opinion.