Censorship is never a good idea, though in some cases it’s unavoidable.
But banning GENERIC terms is PURE MADNESS.
So while it would be ok to ban something like AllahTerror, banning the word Terrorist doesn’t make any sense really.
Watch out because each time you cut out a word from the dictionary, you limit the chances of discussion, and this is BAD for freedom of thought.
But even limited censorship can turn into a slippery slope.
And I know you were just using one example, but we must also worry about a single standard being used for all bannings, not just “AllahTerror” and similar.