Oh it was a shitstorm for Nick and his brother.
Everyone was more or less fine with it at first, but then people started asking if they could have a little less rape, incest and child murder popping up. Now granted you can take all the top stories that were scraped on here and most of those topics really are still far from the majority here, but as we all know AI just seems to laser beam focus on the worst elements of what it's being trained on. (Or best depending on your view point) Especially when it's poorly trained in the first place.
The main issue was the Walton brothers were sort of in trouble with their chat gpt masters since they didn't want to be associated with all the dark subject matter. This was supposed be a family show I guess. I'm sure Joseph Smith was looking down in disapproval. (Yep, unsurprisingly the brothers were Mormons)
Nick's brother was the more puritanical of the two and tried to implement a censor in the AI which worked even worse than intended. Couldn't go one command in without the AI stopping you from proceeding due to it interpreting things as going against the programming.
So then they both blamed the users for AI Dungeon fucking up and being edgelord incarnate. As you might expect nobody was happy with that accusation, though to be fair, most of their users WERE using it for degeneracy anyway since that's exactly what the later competitor Novel AI was mainly used for. They just didn't like being accused of it, plus it really was the brothers' big fuck up from the beginning.
In any case some document came out showing excerpts of various stories here of what Nick used. Naturally the examples were all the most darkest shit on here and of course most of it was from my stories which made it look like I was writing nothing but torture porn stories, when in reality I write regular stories that just have a couple of pages of torture porn in them.
So they had to do a lot of backpedaling, apologizing and hiring a spin doctor to help them out. From what I know they had to recreate a new AI Dungeon from scratch to pull all the CYS stuff out of it, but of course now that means it just sucks even more. I don't think they really recovered since Novel AI sort of gained more popularity.
But that's what happens when you carelessly play around with old dark tomes of forbidden knowledge.
Anyway if you google search old reddit threads about AI Dungeon and CYS, you'll find various bits of discussion of that drama.