I guess it's more accurate to say it's the "only say gay in the context of being happy" bill? You can say the word - but it can't be about sexual orientation.
It says "classroom instruction", so wouldn't it also be okay if it was just the teacher and student in a one-on-one discussion? Since that wouldn't be instructing a class.
I'm gonna guess that wouldn't go you the teacher's way if someone wanted to call them on it.
I'm sure that would easily be categorized as grooming.