Where does that happen? I can't follow your premise, do you say developers are being forced to create ugly characters or are development themselves all "SJWs", do you have any examples?
Yes, in the recent couple of years many big western companies have 'diversity councils' (or similar names) where they basically try to favor the hiring or promotion of non-male, non-white, non-hetero to raise quotas. When the reason of having mostly hetero white males it's because of the demographics of that country, or particularly people interested on (or that can afford) these tech careers. I think it's unrealistic and non-sensical to expect quotas that don't match what do you have in your county or studying these careers in your country.
I mean yes, there almost 50% of females in the society, but if around 12% of the ones who study a career are women, under 10% of the CVs you receive for that department are from women and you have 25% of women on that department you should be more than happy regarding women representation in your company, I think doesn't make sense to aim for 50%. Same goes with skin color, LGTB, etc. I think people should be valued because of their knowledge, skills and working experience and that gender, race or sexual preferences, religion, political views etc. shouldn't affect to hire or promote.
On average women prefer some type of careers more than men and the opposite, there are other careers where there are more men than women. I think each person should be free to choose whatever career they want. And in nordic countries where there is a longer and stronger feminism (the real one, not the current misandry) that also are richer, so there women are more free to chose, it's where the difference in these career choice between women and men are bigger.
Same happens with the 'oh, we have a small % of women in the upper ranks of the company'. It isn't because the company is sexist as the SJW claim. It's because on average men go more to risk and create and own new companies, and also sacrifice themselves more making more working hours, travelling longer or moving longer to get a better job, etc. And specially because men retire on average way later because there's a way bigger percentage of women who after having kids retire to raise them.
They started with that and later expanded that 'diversity council' (or other similar names) to become a woke censorship team of game content: they started to 'promote representation and inclusion' in game characters having similar issues: also ask to include more non-white, non-male, non-hetero characters and big companies have related tokenism checklists asking for quotas of each group, and 'best practices documents' to remove any 'oversexualized' female characters and to make them more 'trans friendly', 'remove toxic masculinity', etc. With quotas that again don't match at all the demographics of the players of these game genres they are making, or the demographics of these platforms where they are selling these games or what the fans of these type of games or most people potentially interested of them want to see on them.
I mean, if around 97%/98% of the people who play sport or racing games on are men, to include female teams in your soccer game and a woman in the cover won't make to highly increase your sales because suddenly way more women will now magically get interested in soccer and soccer videogames. You may get a tiny increase of players compared to your previous one but most players will ignore that mode with female teams, because players want to play with the big stars of that sport, and in this case all around the world are male.
If you want to attract female audiences would make more sense to make the type of games that female players prefer instead of trying to attract them to a type of game they don't like. In game it's like in movies: there are genres more popular between men (like action movies) and other ones between women (romantic comedy, drama movies).
And if the main pillar of your game is a charismatic gaming icon and you replace it with someone whose only main addition to the game is being from other race, gender, etc. people will get pissed off. Because they will want their beloved gaming icon back or at least to have someone as charismatic. It isn't only a race/gender/sexual preferences thing: see the 'new Dante' from DmC or Raiden in MGS2. People hated them and not because of their race, gender, etc. They wanted to see an specific character with some specific attributes and they did get something else.
Devs get asked/mandated to make -mostly female- characters 'non overly sexualized', 'body positive', 'more realistic', 'not designed to be attractive to hetero males' and 'LGTB/trans friendly'. They are asked to reduce boobs and give female characters more -on average- male/androginous body and proportions, to cover all their body with clothes, avoid sexy, unsecure or flirty attitudes or poses, and are asked to make females with strong and aggresive attitudes (specially against men) etc. and the male characters to be less violent, alpha male badass type but instead more sensible, fragile, unsecure, weak. They ask/mandate devs to do this in theory to make the games and -specially the female- characters more appealing to women and lgtb people, plus to avoid 'toxic masculinity'.
But guess what, a bit of that would help but they go too far and end making ugly characters that aren't appealing to mostly anyone other than the brainwashed woke cult followers who have been told this is the correct and they say they like it when most of them don't because they are afraid from being cancelled by the woke gang. And guess what, devs spend a lot of time with these checklist things to appeal the woke gang that could have been spent instead in adding the type of characters and other stuff that the curent and potential fanbase/demographic of that game and platforms actually likes.
Which regarding characters are -guess what- mostly power fantasies (specially for males) and beauty ideals, what always worked in cinema, tv shows, ads, social media, painting, literature, sculpture etc. Go ask who doesn't like Jason Momoa in Aquaman or Henry Cavill in The Witcher. Men, women, straight or LGTB will like them. Now for a sequel replace them with an ugly/androginous woman and fill it with kiddy scenes or dialogs of women being oppressed, men being bad, she being stronger/smater than some random man, she being secure and empowered, etc: only the woke cult followers will say (publicly, specially in social media) that they love the change. Fans will be pissed off because they wanted to see there what made the IP great for them, not propaganda.
Did they ever give a reason for why they cut her breast size?
Not specifically about this change, but as I remember in some interview, podcast or something like that they mentioned they wanted to make their characters less sexualized/objectified/designed to appeal male and to make them more lgtb friendly or something like that. Basically said that yes, they made them uglier/unattractive on purpose (and this includes to reduce boobs).