Representation matters to some people:
Why on-screen representation matters according to these teens.
I'm not hostile to the idea. Most campaign settings are not rigidly defined. I don't think any official publisher has ever said 'nobody in the Forgotten Realms is gay'. Since the Forgotten Realms is a big place and it represents numerous human cultures and there have been gay people in EVERY human culture, that'd be awfully weird. If gay people exist, I'd expect to see them featured proportionally. Ie, if the Forgotten Realms is like the United States and 5.6% of Americans identify as gay, I think it would absolutely make sense if approximately 1/20 featured characters were gay. Keep in mind that I don't think that revealing everyone's sexuality explicitly is necessary or even desirable.
Likewise, a cosmopolitan city should be racially diverse (among humans and non-humans). If 50% of the population is non-human, it doesn't really make sense that 100% of the humans that exist represent a single culture. Melting Pots be melting pots, yo.
The best campaign worlds have blank spots on the map. While they may have been painted in broad strokes, there's room for more detail and nuance when the focus shifts to that area. If a campaign area is 'mostly like China', most people will have an idea of what that means. But as you focus in, you'll see differences between Han, Tibetans, and Uyghur. If something hasn't been defined to be non-existent, then we can consider the possibility of its existence.
In a fantasy world that has regions inspired by the Maya and Filipinos, you'd expect to find examples of those characters in that world. Worlds get bigger as you explore them; the things that you know were included don't become less significant as you find examples of things that weren't thought up from the beginning. This is as true for monsters as it is for cultural groups. I've never had trouble explaining the presence of a heretofore monster; why would a cultural group be any harder?
I've never met anyone from Liechtenstein. But I don't have any trouble believing they exist.