If memory serves me, Nano Banana allows generating/editing photos of children. But anything that could be misinterpreted, gets blocked, even absolutely benign and innocent things (especially if you are asking to modify a photo that you upload there). So they allow, but they turn on the guardrails to a point that might not be useful in many situations.

I was able to generate photos of my imagined children via Nano Banana

I haven't seen that, meanwhile gpt-image-1.5 still has zero-tolerance policing copyright (even via the API) so it's pretty much useless in production once exposed to consumers.

I'm honestly surprised they're still on this post-Sora 2: let the consumer of the API determine their risk appetite. If a copyright holder comes knocking, "the API did it" isn't going to be a defense either way.