The entirety of FFXIV, 1.0 especially, is rife with horrific details like this. Sexual assault, racism, genocide and more abound if you actually pay a lick of attention. Ala Mhigo has always had these elements present if you went digging for their lore, it's just now that we're finally seeing it spelled out for everyone in sharpie. Arenvald is hardly the only child who suffered in those circumstances and the entirety of the Ala Mhigan campaign from twenty years ago was heinous. To the point I honestly can't take people seriously if they know the lore and still claim Gaius is a good person. There is a reason so many in Fordola's generation were loyal to the empire and not all of it had to do with making a better life for themselves.
I think the issue here is that from what I understand, ARR cut back HEAVILY on the subtext compared to 1.0 and so a lot of people missed these story beats which were always present. They also toned down the rampant racism towards Keepers of the Moon and Duskwights in Gridania, keeping most of it to one off NPC dialogue, the Lancer guild, and the Post Moogle Quest lines. Then however once Heavensward came around they started to peel back the kids gloves and actually pick up a lot of 1.0's lore and the implications behind it, rather than kicking it under the rug and pretending nothing bad ever happened.
Though I can understand why this sort of change might be upsetting, it's been telegraphed for a long while.
