Hot take: Even most of the grognards complaining about Appendix N missing would not use it at all, they just want a confirmation for their taste.
If that is really the main motivator, then perhaps a page given over to examples and advice for different tones/styles could be useful?
Lovecraft is certainly Problematic as the kids say, but his influence on cosmic horror cannot be denied. It's sort of like
Birth of a Nation being one of the most virulently racist films ever made (based on a virulently racist, revisionist, and mostly made-up book), but you
have to talk about it in film history courses because it is such a landmark of cinematography technique.
Instead of just one Appendix N that appeals to just one demographic though, why not have (say) 5-10 pages given over to "here are sources
for styles X, Y, Z, W, Q"? I'm a huge huge proponent of DMG books that aim to teach by example and arm the reader with knowledge and wisdom that will help them make their own decisions about what they want to run and the vision they want to pursue. If instead of locking D&D into the reading list that a man 50-odd years ago compiled, we instead point to several different approaches with tradition as one of them, we would simultaneously recognize D&D's roots while supporting new DMs in their pursuit of
their D&D. Isn't that all to the good? I mean, it does mean spending pages on that text. But I have more than a few ideas about ways to save DMG space.