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Nintendo added lesbian sex to Splatoon
(hexbear.net)
Tabletop, DnD, board games, and minecraft. Also Animal Crossing.
3rd International Volunteer Brigade (Hexbear gaming discord)
Rules
It's a Japanese culture thing, not a Nintendo thing.
Japan - and a lot of other countries, Iran being a big example - take the Transmedicalist view as mainstream. They value cultural assimilation along gender lines, but also understand that a trans person is not their AGAB. So as long as you do everything in your power to comform to your preferred gender, most (but not all) people will accept you. Being trans is fine; being "queer" is not.