they made a totally new and optimized engine for those games
The most difficult part of the development was getting the game's scale to work within the new hardware. This entailed the creation of a new graphics engine with a custom visibility culling and complex level of detail systems. All of the environments were rebuilt and optimized for the new system while keeping the original aesthetic intact.
https://en.wikipedia.org/wiki/Xenoblade_Chronicles_(video_game)
“We are now stuck in a difficult position as we do not want the community to die”
Feels to me like they dug their own grave and now complain that the user's are problem.
What are they expecting after they remove moderators and remove the nsfw status? That the users keep posting? They aren't dumb and I could imagine that some or most people will probably stop posting there.