Some rough thoughts: A lot of work has gone into this game, which has deep layers of complexity and interactions running "under the hood" as they say. So far, it has become far too addicting, because, despite some rough spots, the game, and the characters are endearing. As for those complaining about the models, I wouldn't take that too harshly.
I like the fact that not everyone looks like they belong on the cover of a fashion magazine, but, there are some stunning examples that you have primarily in the female category (the green-eyed blonde girl with khaki coloured jeans and a brown sweater, and specifically the brunette that wears a lot of pink & white, and red panties if you've gotten so far in the game, but there are a few others). Not sure if these models are one-offs, as you are using a prompting AI program where the models are not preserved in any way. It would be a shame to not be able to keep those when you do update. So for the females, great variety, some not so attractive, some mildly attractive, some plain looking, and a small handful that are drop-dead gorgeous imho. Almost like a real-world distribution of beauty.
I think you need a bit more variety for the male models. You seem to have either young and skinny twinks, or old and pudgy (bears?), you could throw some more attractive and masculine looking men in there for female players, a few Brad Pitt/Denzel Washington types; males that are handsome and masculine, as serious romantic competition for male players. I understand that most other players are going to be males, so it's understandable that the focus is on female models.
One interesting option is to make download packs of models available and give players instructions on how to remove models they don't like or ones that break emersion (that cartoon-ish looking thin blonde girl that has "elven proportions". She seems too tall & thin to look properly human; maybe one of your earlier prompt "studies". Personally I don't mind a few unattractive people running around, as it makes the game more realistic, but that thin blonde has to go, lol.
>>Also, is it possible to remove the "Defaults" directory in the characters folder? I don't really enjoy the masked characters<<
One other thing that you might want to do is expand the depth of the romantic relationships for the player. Make it optional, but you could could have some expansion beyond take clothes off and have sex, or fixing your spouse's computer. Marriage & family, cheating, divorces.
Keep going with this, it's a fun game, and a great way to soak up days of entertainment time. I am looking forward to the next update, and please ignore the haters. Would be nice if you could work out some of the bugs as well, not being able to hire singers and dancers as soon as they are available seems to kill progress while other clubs are already doing this, and therefore it kills the "fairness" of the game. Thank you for this game, and please don't mind my brain dump here.