They're arguing about whether it's moral to put some thought into which two villagers should have children together. With the implication that trying to get the game to generate a specific type of villager is immoral, because you are discriminating against villagers that you think are ugly. And this may make some children have low self esteem because it will reinforce the idea that only pretty people should be allowed to live.

Or something like that. My brain kind of blocked out most of the nonsense.