Earlier quoted context omitted.
> they would have to do literal translation based on phonetics. That seems pretty unlikely to have happened here; I don't know the Russian word in question, but the Chinese "hui" rhymes with English "clay". (It also rhymes with the more sensibly spelled Chinese "wei"; the 'e' is only omitted when the syllable begins with a consonant. Compare "feng shui".) I'd be surprised if that were a possible reading of any Russia…
A native Russian speaker who is familiar with how Russian is usually transliterated, but unfamiliar with Chinese, would read it very similar to the Russian word in question ("khoo-y"). As to why the filter was applied to Latin characters - I'm not sure, but I'm assuming that's to prevent people from using translit to sneak in profanities. Of course, this ends up being a pointless game of whack-a-mole - there's so man…
Looks like Russians and Americans can find common ground on thinking Chinese last names look like "penis", even if we're making fun of Wang and they're making fun of Hui.