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To lower ratings for a wider audience and to make things easier to watch, animation sometimes covers up, hides, and/or uses cartoony depictions of blood and gore - the pink blood, the squiggle like organs, the fade to black and only verbal mention of what happened on screen.
But Shiboyugi has the girls bleed white cotton. And it's highly likely that those who watch the death games in-universe are treated to the full raw footage of all the deaths, even those that we - anime watchers - have not seen.
After all, I'm sure whoever is part of this "Death Game Watching Club" (just a term that I'll be using for our nameless viewers of the death games that players participate in) that is collectively paying millions to each survivor would want to see the full action for their entertainment. Or at least have all the footage available to them.
And cotton is truly a choice.
Not only does it hide the blood and gore enough that the death games could probably be shown to kids as a fake-pretend show where people 'play or roleplay with their Barbie dolls and plushies', but I'm sure that it also reminds the players that they are like dolls - toys for the entertainment of those watching them. Just as kids can choose to shave or cut off the hair or head of their dolls, the watchers can too. If there are any sadists or control freaks in the audience, then I'm sure that they are loving that power over the players. While they might not be able to rig or manipulate the death game, there will always be this reminder in the players' bodies that they are dolls "in control" of the viewers.
But let's talk about other aspects of the cotton gore too.
Like how it might preserve the bodies for collectors if there will be "doll" collectors of dead player corpses among the viewers in the future.
Or how there must be a dedicated R&D team of mad scientists and engineers to make all the crazy venues, technology, poisons, etc seen in the death games. And I truly wonder if any of this technology is also available and seen outside the death games. Are soldiers also getting body modifications and cotton preservation treatment? Something similar? Or is it something special and exclusive to the young girls who enter death games?
Or let's talk about whether seeing cotton is truly better than seeing blood and gore?
If viewers are watching the death games while eating snacks, tea refreshments, or dinner together, would cotton gore be easier on their eyes, minds, and stomachs or worse?
Because replacing blood and gore with cotton can also pique the curious mind and make it truly think and wonder even more of what is actually being shown. Is all the cotton puffs truly just blood? Are flesh and organs also being splattered? How much is blood? How much is gore? What is actually being done when Chie became an entire pile of cotton?
Here, the morbidly curious mind might unintentionally think even more about what is being seen rather than glossing over it as it might for the expected blood and gore.
If they are eating meals like a thick, juicy steak for dinner, they might even think more about the meat of the matter.