I mean, your not wrong, Raz. Its like how we're a soft military setting, but we can still attempt to be narratively convincing. Or to put some extra thought into how we handle that. Sure, we want to accomodate all the strange quirks of our characters, but having that framework can be helpful.
I feel like the "fixes" wouldn't be inhumane. Yamatai has, at least, seen the practical benefits of benevolence. Reprogramming for viable service sounds like a thing that'd exist, but I'd also imagine they'd require explicit consent for the procedure. Theirs also the question of where lines are drawn: When someone might just need monitoring, then medicinal aid, then drastic psych-eval.
I feel like that'd probably where a lot of laxness might come in that'd allow such a merry band of occasional misfits. I mean, I know a lot of PCs are nutty, but I'm also operating on the assumption that most other non-played characters of this faction are NOT as nutty. That player characters are inherently stand-out. Hence some Neko in charge waving off some concerns, downplaying, "Cats will be cats."
Patients running the asylum or something.
Theirs also the question of complexity with the Neko digital brain. A thinking machine like that would be incredibly complex, even to a like intelligence like a MEGAMI. Simply deleting a gig of depression seems... too easy. Especially from a story telling standpoint. It could be done, but a lot of things would probably be easier to just have some counseling or the like.
Also how common do you guys think post-backup identity crisis would be? Am I real, or am I just a copy wearing the skin of a dead woman? How do I prove that I am myself, despite this reincarnation?