how come? There's auto approval on pretty much everything you post on websites, it's a rare exception for stuff to get premoderated. For example your very post there was auto approved. Is it now the mods fault if you posted CP and had to get banned?
Auto approval works for around 99% of submitted emotes and works with a level of trust towards the streamers. If a streamer violates that trust, it's their own fault. They did the thing, their fault. Isn't that something that people complain about a lot lately, that people are unwilling to accept responsibility for what they've done? "It's auto approved, not my fault!" falls exactly into that line of misbehaviour imo.
Besides, even if they weren't auto-approved but manually checked, I wouldn't be surprised if someone who uploaded multiple emotes like that for manual approval would end up banned anyways, just because twitch doesn't want to deal with this shit.
And to quote the great Buck Turgidson - I don't think it's quite fair to condemn the whole program because of a single slip up, sir.