Itch isn't the bad guy they're just refusing to pay out to NSFW devs for "breaking TOS"
It's not only NSFW games that are being shadow banned. Penny Larcney Gig Economy Supervillian has no nudity or explict content. It does however have progressive story lines on trans rights and it has been shadow banned. This is being used to take down progressive content too, it's not 'just' about porn. That's the fig leaf they are using to hit other targets.
End of the day, if capitalism is the argument for why itch.io gave up without a fight, it's also the reason I can comfortably say- tough luck, I'm taking my business elsewhere (permanently).
Reliability (and of course, having an actual product) is king, and in this case itch.io has demonstrated it is not a reliable platform - not for its devs, not for its consumers- and it has delisted games from peoples libraries, to boot. Why would anyone ever use a service after such a scandal?
And such a "merciless" capitalistic response is natural, as well. Why should customers or devs impacted feel any loyalty or solidarity towards the site which screwed them over in a big way?