I want to engage you on this post because you seem to be advocating the position that, if someone finds something offensive enough, censorship is okay. I'm not sure because I don't know what you mean by 'outcry'. If someone wants to make the KKK game you suggested, then in my view they should be allowed to do this. Now if you mean we should call it out for what it is, a racist bunch of nonsense that we personally find offensive, I agree. If by outcry you mean we should attempt to censor the individual who made them game, I totally disagree.
I have no problem if someone makes a game dealing with any situation, scenario or theme; it is their right to do so, and while I'll not condone it by buying it, neither would I condemn anyone who wants to make or buy such things. Your claim that art needs to be free, only to continue by saying that it has to fit some mold of tact or care. Who gets to be the arbiter of what is tactful or careful? Does GTA treat murder with tact and care? Of course you've already said what others have, that murder and rape are different things, but there are plenty of people that would just as quickly claim that the 'tactless', 'careless' way with which murder in GTA is treated is deserving of censorship or moral outcry. Who draws the line between what is too dark? Which subjects can be treated with tactless, graceless abandon and which must have the 'appropriate' somber tones.
I say we let our wallets decide. Those who want to play rape games can play rape games, those who want violent games can play those, those who want Viva Pinata 3 can play that (I know I do). And let none of us or even most of us decide who has to treat what fantasy in what way.