Another reason that shot is awful: It’s comes off as funny, but it shows torture.
They may be kids films, but torture has been part of Star Wars from the beginning; arms or hands being chopped off in every film, Leia’s interrogation droid / mind probe in Star Wars, Han on the torture rack in Empire, Han being bound and nearly eaten by the ewoks in Jedi, and of course the ultimate torture scene of the saga, the Emperor using force lightning on Luke at the end of Jedi.
How is the gonk torture scene fundamentally any different? Torture is torture. You say that to you it comes off as being funny, and if that is your opinion, I believe you. However, it never seemed that way to me, either watching it as a kid in 1983 or as an adult today. The scene is there to show the jeopardy Threepio and Artoo find themselves in at Jabba’s Palace. Of course if Ady doesn’t like it, it’s his edit and so he has a perfect right to remove it, but I for one would miss it.