Evidently, the Japanese Pixel Monster is a product of Japanese censorship laws wherein adult movie theaters are free to show absolutely anything (be it live-action or animated), so long as any genitals are blurred.
Pervert: "So I was watching this awesome porno with two Japanese chicks crapping on each others' chests... it was really hot, except when they went to do the close up—get this—the Japanese Pixel Monster came along and blurred out the girl's ass hole! Can you believe that?? I could barely see the turd squeezing its way out.. so now I'm like... pssssht... what was even the point of all that build-up, ya know?"
Friend: "Dude, that's fucked up."
Pervert: "I know, right?!"
Friend: "No, I mean I can't believe you watch that sick shit."
Friend: "Dude, I don't think we can be friends anymore."
Pervert: "Oh, I see......"