Blizzard isn't congress. They can make these rules for the same reason schools can legally disallow vulgar speech.
Well, I don't think it's quite like that. Children have a right to an education, and vulgar speech apparently interferes with that right, or something to that extent.
Blizzard can make rules using their service because they provide it. If you do not want to follow their rules, you don't have to play. It's almost like a restaurant/stores; they have the right to deny service. For example, you see those signs that say, "No shirt. No shoes. No service." Technically, walking around without a shirt is freedom of expression. Are they impeding on your first ammendment rights? Absolutely not; you don't have to use their services. The difference is that everyone is subject to laws, and only people desiring the service are subject to the terms of that service.
At least that's how I see it.
