Because rejecting hateful content and making it fringe and inaccessible is for the good of everyone. Exposure to race, sex, gender identity and sexual orientation based issues makes everyone more aware and empathetic of the issues that other people face, and that's a good thing.

And yes, both of those mod ideas you proposed would be just as bad or worse than this one and should also be deleted from Nexus mods.

Nexus should not host such mods.

But It's a single player game and anyone who installs such a thing already feels that way.

So if it made all the good guys white and all the bad guys black we shouldn’t be concerned?

...and what if it did the reverse? Or eliminated all members of a given race or sex from the game/changed them to a different sex or race?

I'm just going to stand by my original position - someone creating and using a mod only effects themselves and others choosing to use the mod. The fact that other people are using a mod you don't approve of has no impact on you, and if this mod existing hadn't got a Vice article most of the folks in this thread upset about it would simply have never known it existed at all, because they're unlikely to go looking for such a mod.