The more relevant section is here

“It’s not uncommon for larger game companies like Bethesda to have mixed reactions to fan-made projects of this scale, we saw this with things such as Fallout: The Frontier,” says Carter, referencing the game-sized mod for Fallout: New Vegas that launched in 2021. “They often tolerate projects’ like ours’ existence as long as they don’t infringe on their intellectual property or negatively impact their brand.”

That said, I agree with you. The Frontier had issues because they put problematic shit in their mod. Bethesda has explicitly given shoutouts to Sim Settlements (I’m pretty sure there’s others) in the recent past.