The answer for Greece in the 1960s, when Britain was portrayed as a gay and trans wonderland, is almost certainly not the answer for China in the 2010s. But I’m reminded of it nonetheless.
And the answer for Greece was, early and high publicity moves towards decriminalisation, that left people in conservative Greece puzzled. Possibly in combination with stereotypes about effete Englishmen. (I doubt that Greeks were well informed enough to know about public school homosociality.)
In fact, Kostas Tachtsis, himself a gay Greek writer at the time, had to explain to his countrymen that far from a gay wonderland, Britain was a place where gaybashing happened. He had to explain it because, for all its ostensive conservatism, Greece was not a place where you’d be beaten to death for being gay.
Now, you can explain the association of the UK with gays as decriminalisation in the 1960s. I doubt you can explain it like that in the 2010s, when decriminalisation is throughout the West. I’m not convinced that its a slash fiction thing either, that Feifei posits. Maybe it’s the effete English stereotype again?