You aren't arguing in good faith here, but thats for the course. No one is actually saying saying calling children slurs is fine. But WoW already has multiple ways to deal with that. Most/all the scenarios you keep bringing up are the ultra extreme and I would say no common at all. You can already report people and ignore them for saying slurs. If enough people report they will be silenced and eventually banned\suspended. Playing since early 05, and the amount of times I have seen someone say the n word is very low. Some of the other examples you are mentioning are straight illegal in most? countries, and should be met with the law. Its definitely a fallacy for your reply to "I don't trust one persons example of basic toxicity" to then be "Oh so you're fine with sexual harassment, online stalking, and saying racial slurs to children?"
Mainly because those things are already against the ToS and result in bans, and no one here that I have seen is advocating for that threshold to lessen. In my opinion, routinely arguing in bad faith is toxic, while others in this thread have literally said would consider mentioning player performance at all is toxic, and that you should instead leave the group if you are upset that someone is playing badly instead of commenting on it, at all. "What is toxicity" isn't something that can really be answered easily. But like, 12 year olds can also use the profanity filter and not even be aware of what words were used.
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Besides stifling so much freedom, my other problem with this point is how truly fake it is. We can all applaud FF for its rules, but most/many of those player sonly listen because they have to, as you basically said. I don't think at all its a culture issue. FF fans on this very forum are often nasty, and places like Reddit and Twitter are pretty awful too. You can see just as much "toxicity" on those subs.