Not to get on a soapbox, but I think the main issue is our country's lack of sexual confidence. Brokeback Mountain, which was far from a good movie in itself, really broke a lot of barriers regarding homosexuality. Back in the 90's, even, Nintendo had strict requirements for their games, but Mortal Kombat broke a lot of those barriers. Now, AH3 is being released here on a system known for its Japanese otaku. Microsoft, despite their attempts at appealing to the Japanese, doesn't feel comfortable alienating a fan base that plays mostly FPS reruns like Halo, CoD, and BF. They are completely capable of making exceptions to their rules, like Symphony, but don't want to take a risk with their platform, mostly due to public perception. Is loli-ism bad in itself? Probably not. Any sort of hint of sexual tones with underage girls here will do more than raise a few eyebrows here, though, because of our insecurity.
/rant, /ontopic
I don't mind a digital download. I hate losing discs or getting them scratched at keggers.