Eh, we used it as an office chat until my boss set up Slack, and then kept using it when we played games after work. It was okay.
I never joined any public channels though, only the handful of ones with various gaming friends. They have since moved on with life, so I uninstalled Discord.
Yes, physical appearance, because of racism, sexism, or other discrimination. Not digital appearance.
If you walk into a business dressed all in black with sunglasses, a mask, and a hat, that business might refuse to serve you until you look less like you're going to commit a crime.