Nations where people are executed for same sex relations imo are also not nations the Republic of Atlasia should have an embassy in, which on your image is (red-coloured nations such as Iran and Afghanistan).
BRB writing a story about Atlasia pulling its embassy out of Malaysia after the inevitable PAS landslide in 2025!
I would never assume "the State Department" is a monolith making these decisions since at the end of the day it is the staff onsite in 200 different nations who will be choosing pretty much at whim whether to fly a flag of whatever variety. I had my qualms about the law as demonstrated by my signing statement at the time, but it eliminated that potential for uncertainty.