The confederate flag is about exactly one thing, which is white supremacy. The other flags being sarcastically listed as replies to this comment stand for higher ideals, whether or not those ideals were misguided and whether or not the nations behind those flags lived up to those ideals.
If someone puts a sign up in the break room that says “don’t steal other people’s lunches” and then proceeds to steal everyone else’s lunch, you can still point to that sign and say, yeah, that’s a standard we should strive to live by. It would be more difficult to say that if someone puts a swastika up in the break room.
I'm not asking someone to judge the ideals of the UK vs the ideals of the Confederacy — it is an exercise in subjectivity for you or I to declare that the UK or the US is or isn't "bad enough," or whether the Confederacy had ideals. This doesn't mean either of us are wrong or that these guidelines can't or shouldn't exist, it just means we're not in a position that our judgements on the matter mean anything.
The specific practical matter is that the last actual official Mississippi Flag contains, in one corner, the flag which people think of when you say "Confederate flag" which has specifically been called by Twitch for its association with slavery in America. While the Mississippi flag might in select contexts be used to mean "white supremacy," it also means things that are not identical to the concept of white supremacy: for instance, it means "Mississippi". Is this enough of a difference to allow the Mississippi flag, or is it still associated with slavery in a strong enough matter that it should be banned?
One recurring problem with speech codes is ambiguity of this sort. Even though the guidelines Twitch has provided are much more detailed than most online chat platforms have deigned to make available (cough Discord cough) there is still nontrivial ambiguity over these matters — ambiguity which can only really be resolved by authorized representatives of Twitch itself. In the broader world, when such ambiguity exists in the law, we have things like a court system with evidentiary standards and a presumption of innocence; these are things we lack on Twitch.
If someone puts a sign up in the break room that says “don’t steal other people’s lunches” and then proceeds to steal everyone else’s lunch, you can still point to that sign and say, yeah, that’s a standard we should strive to live by. It would be more difficult to say that if someone puts a swastika up in the break room.