Do they have to censor the kisses by law?
No, and don't believe anyone telling you otherwise unless they can actually show that the language in the media advisory is a binding enforcement, or explain away the counterexamples of much more explicit GL scenes being published without incident.
Yes, if you publish explicit gay works, you will have a nightmare of a time getting publishing support, and your current supported/serialized works may find themselves without funding. Hopefully, sooner than later, there won't be any fear mongering from boomers that allowing that sort of content to receive support will lead to the erosion of cultural values, but I fear that day is farther off than it should be.
It sucks, but cultural mindsets are a difficult and long term enemy to battle, and if it's any consolation while there isn't any significant protections for us on paper, it's still safer to walk around Pudong, Shanghai than Jacksonville, Florida with your same-sex partner.