Something doesn't have to be illegal for it to be a story and it's not ideologically inconsistent to agree that Cloudflare has the right to not serve these customers while also scrutinizing them for it. What is legal/illegal is not a substitute for a personal value system.

A company as large and important as Cloudflare disconnecting a client for moral or public outrage reasons is a big story and they should be watched with a careful eye even if you agree with the outcome.