This is especially frustrating given the commercial was already pre-approved by British television advertising clearance body Clearcast, just one week ago, who then considered the humour in the advert, while not to everyone's taste, fell short of causing offence.
But what this omitted was not that the objection was to the advert causing "offence" but that it was likely to create a worse situation for trans people. In the words of Helen Belcher of TransMediaWatch :
The issue was not about offence, but simply about respect. The advert placed real people at risk of humiliation or abuse simply because they could be perceived as being trans.
But Paddy Power cannot see the problem with their "humour". Perhaps the readers of this post may not see it either, so let me spell it out. Transphobia is not about a mere laugh and a nudge at someone who is dressed differently from how you might expect them to look. It is about the daily hostility and humiliations some fellow human beings have to endure simply because they are seeking to realise themselves rather than have to impersonate somebody they are not.
Many trans people go about their lives in fear of the "mare or stallion" confrontations they have to suffer from strangers which Paddy Power is so gleefully happy to promote. And this mockery and taunting can sometimes lead to the sick violence of "tranny-bashing". As the journalist Jane Fae writes about the Paddy Power adverts :
So the Paddy Power ad campaign is all just a bit of fun? Just for laughs?
Sadly, the evidence already beginning to come in is just the opposite - and pretty much in line with fears expressed at the supposedly more "alarmist" end of the spectrum.
Earlier this week, a trans woman flew into London, where she stayed overnight in a reasonably upmarket hotel. Yesterday, at breakfast, two of the waiters huddled together, staring at her. Shortly after they were joined by two more staff. One of them pointed.
As she explained later, she knew she'd been 'read'. However, the last thing she expected was for a young Spanish waiter to be pushed forward.
He came over and asked her if she was in the Paddy Power advert.
He was speaking with sufficient lack of concern for her privacy that other guests were able to hear and, as a result, two business executives sat next to her loudly asked to be moved to a new table.
[...] many of the "just a laugh" brigade will still be puzzled by all of this. After all, there was no violence: nothing.
Except that paid staff thought it was OK to humiliate her with impunity.
Such dreadful experiences are not unusual. As Patrick Strudwick writes today  in the Gay Times:
[A] 60-something trans woman spoke about her life. She had only transitioned a few years ago, and when she did she lost her family, including her children. She did not break down as she said this. She did not pause for dramatic effect to let the devastating news sink into the audience. She mentioned it in passing - this is so normal for trans people that it is half expected.
She reminded me of a transgender woman I met at a hate crime rally a couple of years ago. "I get abuse every single day," she said flatly, almost casually, "From name-calling to threats of murder."
No gay person, apart from those being bullied at school, experiences that level of hate.
Paddy Power may not have thought they were promoting bullying; they may well have been "only joking". But for them to seek some commercial advantage by stoking an already hostile environment for trans people was a vile and shameful exercise. Trans people surely have enough to put up with from other members of society, and it was wrong for Paddy Power to seek to make it yet more uncomfortable just so they can get more revenue from gamblers.
A modern liberal society should not encourage the banning of humorous adverts. No one should be a criminal just because of a bad joke, and no sensible person wants to criminalise advertisements made in bad taste. Freedom of expression is a basic right, just as are the rights to privacy and autonomy. We do not create a more civilized society by resorts to coercion against free speech. And, in practice, censorship is illiberal and often misconceived.
However, any exercise of freedom of expression certainly does not mean that others must fall silent. A more humane and liberal environment requires those who sneer should also be challenged and confronted. The rights to condemn and complain are just as much free speech acts as any "bit of fun". After all, freedom of expression should work both ways, and not just for the benefit of big business.
So if there has to be a special system of regulation for broadcast advertisements, then it is certainly more humane for the voices of those seeking to promote a respectful and safe environment for marginalised people to prevail over the interests of a large and brash gambling company.
Fundamental to any modern liberal society is a sense of respect for all those whose road to self-realisation may be different from one's own, as long as any person's self-realisation does not violate the rights of others. How free speech can be squared with such personal autonomy is more a cultural and moral matter than a legalistic one.
Paddy Power may be enjoying their notoriety and their defiant pose. Any company whose business model is based on encouraging those with little money to gamble it away is unlikely to be a moral exemplar in any case. But they should perhaps reflect that some people do want to ban gambling, and why it is not banned.
It is because others are happy to live and let live that gambling exists as a major commercial concern. The popular sense is that if people want to gamble, and make money out of gambling, then it is entirely a matter for them. So it is disappointing that Paddy Power and so many others who take autonomy for granted in their own affairs are so ready to make it difficult for others to do the same. It is not only the bookmaker and the punter who should be able to get on with their lives free from the intrusions of others. The benefit of self-realisation should be open to us all.
David Allen Green is legal correspondent of the New Statesman