The previous guard with Feweh and Apop wouldn't have given two shits about the "Nantucket pretending he's a samurai space marine" because they would've found it funny, the same exact way Bancrose was favored by Feweh when the guy used to play a commander ripped straight out of Nazi Germany. There was an incident where Fitchace/Bill Carson said something along the lines of "Them niggers secretly adore slavery" and then dabbed, and when people started ahelping Feweh laughed and said "IC racism is perfectly fine" in OOC chat. The current moderation team is actively considering tightening racism rules and has less tolerance for these gimmick characters, so try not to scream insults at the top of your lungs like a whiny child that misses his mommy when you don't even know what you're talking about.
Rule 3 isn't a rule that needs changing in any way, as we've had this rule for years now with no problem whatsoever. Most of the problems cited in this thread have less to do with the rules themselves but rather the way they're enforced.
At most rule 3 should be reworded so that it's easier to understand. Some people assume any and all forms of racism is a rulebreak while others know it's just to stop people from verbally abusing others in game with malicious intent, hence why "no racism" is not a main rule and is merely listed as a part of the "don't be a dick" rule.
The real problem is that staff is piss poor at maintaining consistency with their enforcement of the rules- people simply saying "nigger" regardless of context will get people warned one moment while saying "niggers should be sat in the back of the dropship" the next would be deemed as an IC issue, for instance. Two people can ahelp to be respawned after observing and failing to roll event characters and two different moderators will handle the ahelps simultaneously, one saying to the first player "sucks for you bucko, you took the risk and it didn't pay off" while the other moderator wordlessly returns the second player back to lobby. From the prospective of an outsider looking inside, it's very clear to me that the mod team agrees very little on how rules should be enforced and they have conflicting ideas for important issues. It should be ironed out by head staff.
The report made on the players for a breach of rule 3 should've been closed the moment that every involved party stated that they weren't offended and that they were just having fun with each other ICly, imo.