It wouldn't be such a problem if they said they want to make the game enjoyable to play even if you ignore the Nsfw part or something like that, that's not what they said, the toggle changes everything. Do you people think sex scenes are the only things that count as Nsfw? Have you seen the kind of clothes some of the women wear, like the dancing girl, her clothes are barely there. In the game the Lizard people are presented as if they don't have much consideration for things such as modesty. In the demon fox intro she is naked, the lizard women sleeping in the room are naked. All of that would have to be changed in my opinion to make it actually Sfw. Maybe it won't be as much work to create alternate outfits for everyone but it will change the feel of the world, and it takes resources away from core development which they sorely need, so what will end up happening is the whole game will become a little more Sfw except for the sex scenes.
Also consider the current game and think any main event in the game which does not include Nsfw scenes, Introduction to the village, Demon fox backstory, Nesi's relationship with kantir, clothes getting stolen etc. Without Nsfw scenes the story is incoherent and all you are left with is busywork, drag the pot, pick up sticks, tan leather, the end. If they change the events to be Sfw, as it stands right now the story is not anything to write about and gameplay is way below mediocre, without porn this game is nothing. In two years they haven't added support to move using keyboard, even though they have the simplest form of traversal posiible, just left and right, and they say platforming was always planned. At the very least I've never seen a 2d game with models bigger than half the screen and only mouse controls with platforming. I know they've said they'll add a lot of stuff to make it better but we have yet to see anything, I'm not saying to disbelive them or pull support, but a little caution and a bit more pressure on them wouldn't hurt anyone.
In the end the Sfw toggle may seem like a small thing to many people but it's not if you look at the bigger picture. They have bigger problems. These 2 man developer team worked for 2 years (from what I've read) and their work ended up a mess as they realised they bit more than they can chew and overestimated their ability to make the game. So, they bring in 3 more people, good, but then they become even more overambitious and increase the scope 5-10 times more, with so much customisation to Krystal, from what I've read demon fox will be added later in the story so the story has a much bigger scope, there will be multiple villages, combat system like KOTOR, Platforming etc. They still have what looks like more work than what their small team can accomplish unless you can wait 4-5 years more.
All this given that they've yet to complete a single game. It's not such a small thing, even if they rushed and finished the game as it is right now with a little more content and sequel bait, that would be better. My brother is a game developer so I know little bit about how projects work, in the end there will always be something more you can add, something more you can polish and make better, something you can change etc, if keep doing all these things the game will never finish, you need to learn to set bounderies and deadlines and finish what you can. This is not a problem with just small developer, Look at Star citizen, 8 years and 250 million dollars later, it's still not finished. Look at Anthem with Bioware, a AAA studio with such a history and acclaimed games under their belt and experienced veteran developers. They spent like 6-7 years on that game, first five years they just dicked around apparently and after EA came calling for their game they started actually developing and came up with the half baked piece of crap it is now. But at least Anthem got made, these are newbie developers(at least there is nothing else they've made that I can see), making the game at their own pace who love going on vacations and have no oversight. Their ability to make an actual game and finish it is in question, so I don't think it's such a good idea to be talking about SFW filter for a game where most people are supporting them to for the promise of a decent to high quality niche fetish porn game they are unable to get anywhere else. (I can also talk about some other things but this post became way longer than intended so whatever I guess.)