In the jam description it's written, that one should avoid controversial subjects... But does that imply, that they're completely banned? I mean, some subjects that can come across as controversial have great potential for a deep lore.

To be exact, you can talk about it, or use some subject, you just have to avoid doing something that could make the whole work misunderstood or rejected because of it. And above all, you have to know how to nuance the subject and how to dose it well so as not to fall into pure controversy. (Unless, of course, the controversy itself is used to make you think about a particular subject).