If you want to know more about male homosexuality in Japan, I strongly suggest you read Ishikawa Taiga's autobiography, 'Boku no Kareshi wa Doko ni Iru?'
You'd have to read Japanese, though. At any rate, Ishikawa is an openly gay politician, currently a representative of the Toshima ward in Tokyo (where Otome Road is located, weirdly enough). He isn't just openly gay but his platform is entirely supportive of lgbt rights, complete with his showing with a rainbow flags at events.
He is actually not only the one either. There are at least other two that I know of, one of which is a lesbian.
With that said, this is Tokyo we are talking about. I cannot imagine Taiga standing a fighting stand anywhere else (perhaps Yokohama?) and chances of his ever getting to, say, the Diet, are slim to none.
Incidentally, some wards in Tokyo actually do have housing rights for same sex couples. Shibuya and a few others.
As for the lack of public outcry against homosexuality in Japan, as opposed to the very vocal anti-gay voices in the West, that has more to do with the fact lgbt rights are hardly ever discussed. It does not cause much controversy because it's not a public topic.
And there is outcry when it does get mentioned, actually. Just a few months ago, some ward representative in Tokyo made a statement to the effect of homosexuality being perverse. She was not alone in thinking so and was endorsed by others.
Back to YOI, as I got very off-topic, another reason for not making it actually gay may very well have to do with airing times. If the show opted to have an on-screen serious kiss between two males, it should be bumped to a later slot, more likely than not. And this can very well kill a show.
I'm not too sure this was a factor in YOI specifically but it is something that anime shows in general need to be very careful of.