Rients hits the nail squarely on the head with the problem of Tlaloc, the Mesoamerican rain god (a.k.a Chaac or Chaac-Mool). Featured along with the other Precolumbian Mexican gods in the 1st edition supplement Deities and Demigods, Tlaloc's demands for innocent blood presented an interesting challenge for players and DMs alike -- how do you square the otherwise civilized behavior of a people such as the Aztecs or Mayans with the mass human sacrifice practiced by both cultures as a matter of course?
The Hero with a capital H says that, put simply, you can't. According to big-H Heroism, when faced with an example such as this...
At each full moon, a priest of Tlaloc sacrifices a child or baby to Tlaloc. Once a year, there is a great festival held in his honor. Numerous babies are bought or taken from the populace. These babies are sacrificed to Tlaloc, after which the priests cook and eat them. If the babies cry during the sacrifice, this is taken as a good sign that rain will be abundant during the coming year.
...the only proper reaction is revulsion and disgust. What's more, even if you are born and raised as a member of this culture, as a Hero you must be aware on some fundamental level that these practices are shameful and wrong and not just the way things are done. If you've ever read Gary Jenning's Aztec, you get a great illustration of the big-H principle at work, as the protagonist -- a Mexica artisan -- quietly revolts against the injustice of giving Tlaloc his due. To suggest that acts such as this could be "normal" features of the hero's world marks you as some kind of Godless cultural relativist.
The trouble is, Deities and Demigods was inviting no such summary judgment on the player's part. The whole point of the supplement was to give campaigns some mytho-historic flavor, not to present players with the evils and injustices of alien cultures as wrongs to be righted. Not surprisingly, back in the 70's and 80's the Moral Majority types seized upon the descriptions of Tlaloc and other similarly cruel and/or bloodthirsty gods as evidence of the moral bankruptcy of D&D. Never mind that back then most of us (those of us just hitting puberty, at least!) were more interested in the naked pictures of Aphrodite and Ishtar than we were learning about how human sacrifice was A-O.K..
But D&D has always had these issues -- should fantasy roleplaying implicitly judge its setting, or merely describe it and let the players figure out what's wrong and what's right? As time has gone by, Dungeons and Dragons has drifted ever more solidly into Hero territory, reflecting both political correctness and corporate risk aversion as the RPG has evolved from a countercultural pastime to a mainstream gaming product. One of my favorite examples of this in D&D is its treatment of the use of poison by player characters. While the 1st edition does not shy away from providing a virtual apothecary of poisonous substances available to players, already by 2nd Ed. poison use has been marked as "evil" behavior -- never mind that Herakles, one of the greatest heroes of Greek mythology, used poisoned arrows to defeat several enemies during his celebrated Twelve Labors! 3rd Edition further circumscribed player use of poisons by making them available only to certain evil prestige classes, and while I'm not sure what 4E's take is on the topic it doesn't seem to be the kind of game that would favor such non-Heroic tactics.
While I've always enjoyed trying on another culture for size and questioning my own assumptions about what makes a hero, I know that even among gamers there's quite a spectrum of comfort in this regard. One of my best friends from childhood was squarely in the big-H camp, and refused even to entertain the possibility of a hero who was first and foremost a product of his times -- we would have the most epic arguments on this point, with him championing Joseph Campbell and me full of my recent studies in (of all things) Mesoamerican culture. The Aztecs are one of history's greatest character studies, and I daresay that they will always be.
In the case of Carcosa, I think McKinney is offering up something up something similar: a kind of Rorschach test for latter-day gamers. Do you play it at face value, or with a sense of irony? Do you accept the culture of the campaign world, or rail against it? The beauty of roleplaying is not just that you get to decide, but that there's plenty of room at the table for different answers.
UPDATE: The web is a beautiful thing. No sooner did I sit down to work this morning than I noticed that Geoffrey McKinney himself stopped by to see what I had to say! For the record, he offered the following clarification to my admittedly hasty summary of Carcosa's setting--
"Not all PCs on Carcosa are sorcerers. Some are fighting-men. Also, about one-sixth of the sorcerous rituals in the book do not require human sacrifice. It is entirely possible to be a Carcosan sorcerer who never sacrifices a human. In fact, since the rituals that require human sacrifice are more dangerous to the sorcerer than are rituals that do not, a sorcerer who does not sacrifice humans will probably live longer than the sorcerers who do."