Yes, Steam can decide to not host something. They have strict guidelines and quality standards. Which means the main content must have been in the game when they scrutinized it. And they did greenlight the game in the publishing process. Think about that. A professional or more had an actual look at the game and decided it was ok for the adult section of the platform.
Makes you wonder. Are those people greenlighting games idiots? Is Steam ok with "rape simulators"? Or maybe the activists trying to remove the game did not use quite the truth to rile up their angry mob... (Just read the statement of the developers what actually happened on Steam. Don't take our word for it).