They're referring to depicting real life minors as digital, computer-generated or a cartoon of, not fictional drawings that aren't based on a real child.
I should also note this:
In the United States, child pornography laws do not apply to drawings, cartoons, sculptures, and paintings of minors in sexual situations under 18 U.S.C. § 2256. However, they remain subject to obscenity laws if they do not pass the Miller test and are potentially illegal under 18 U.S.C. § 1466A.
In a sense, this is a grey area in terms of legalty and not explictly illegal. This can also to apply to many visual novels that have legally released such as Saya no Uta (can be found on steam) that features a loli and is R18, School Days which focuses on underage characters as well and is legally sold and such.
Also recently the amount of false reports on fictional drawings has lead to many asking to stop wasting resources when reporting, as it takes away and distracts from actual real life victims.
As always, if you don't like this then that's find and you can find this game disgusting or weird or whatever you want, you can just move on then worry about it.