I wouldn't ban any of these, really.
For the "sexually explicit and depraved" material, I wouldn't ban this any more than I would ban all books with erotic scenes, or all nude paintings, or even porn flicks for that matter.
For "Exceptionally extreme violence", I believe that it has it's place. The original Soldier of Fortune acted to me in many cases as a chanelling device for rage, not all that unlike beating up inflatable clowns. And if YOU'RE not the one doing it, I believe torture and infanticide can truly bring your blood to a boil, and make victory all the sweeter when you gut the sick freak who did it.
For the "Politically insensitive content", I'm not even gonna bother mentioning how that would involve banning all RTS games where you could ever concievably attack your enemy because they have more of a resource than you do. And of course, banning Warcraft 2 and 3, (And Serious Sam 1 and 2, and Command And Conquer Generals...And every Mario game with bob-ombs) for having suicide units!
Out there stuff has a place. I'm not saying every game should involve graphic decapitation of American Soldiers as you defend Iraq's honor, followed by rough over-the-top onscreen multi-position intercourse with one of your many virgins in the afterlife.
I'm saying that these games need to be CAPABLE of existing. (I definitely would dislike, and never buy, the above mentioned game. But I should be allowed to make it if I really want to. Sure, I'd have to sell it over the internet only, but so what?)
"Rape Sims" and "Murder Sims" have a place, the first with certain scorned and angry men (generally Japanese ones), the second with anyone who has ever proverbially seen red and mused (without any real intent of ever carrying out) bloody murder to make themselves feel better.
If a game lets me graphically slaughter an opponent, great. It might be tasteless, but if I ever feel white hot rage for whatever reason, playing that for a while is a far less destructive way of venting than, say, headbutting walls or punting expensive objects of art.
Controversial games need to exist, but not so that you can feel the thrill of being a suicide bomber, or the sheer joy of shooting high school kids.
But to bring these subjects to light in a different way.
Seeing as most of us live in countries of freedom of expression, you can happily and blissfully ignore games, books, movies and pictures that you dislike (unlike, say, protest rallies to declare Adolf Hitler's birthday a national holiday, or spittle being projectiled in your general direction because of race/sexual orientation), but NOBODY should have a right to say "nobody could ever make this, ever" if it ultimately doesn't hurt anyone at all.