Where is that claim? The above tweet from Elon also said “I’m told that this account was suspended for posting child exploitation pictures associated with the criminal conviction of an Australian man in the Philippines.” That doesn’t mention blurring or any other filtering. Absent some other evidence I’m not sure why the Twitter CSAM team would ban an account for sufficiently-blurred media.
Discussion
I saw that claim from people on Twitter who said they had seen the actual photos while they were still up.
This is one of them problems with this stuff: the public can't legally see the evidence of what actually happened. Not even most employees or the owner of the company.