(Fundie: before you ask i'm Brazilian,but i have Japanese heritage on my mother's side. I am a shintoist.)

I have a theory that most media that depicts youkai as cute anime women (Example:Touhou) is being controlled by them in some way. Think about it. It would be a lot easier to lure humans to you if they perceived you as "uwu cute waifu." Heck,this may even extend to their physical forms aswell. No one would want to have sex with something like a Kasa-Obake or Kappa (unless you're into that sort of thing) so they've altered their appearances to take forms based on the depections of youkai as anime girls to lure in their prey.

https://www.reddit.com/r/2hujerk/comments/1d0bpy3/touhou_is_a_youkai_psyop/

https://www.reddit.com/r/2hujerk/comments/1d1ghpy/the_veil_of_gensokyo_and_the_extinction_of_the/

Every group needs a enemy. Truth is,it's unclear how much we know about lunarians is true or fabricated by the youkai,and it's unclear that their civilization even exists. SSIB was created to demonize the lunarians and make the Youkai look good by comparison. Besides,Yukari could easily have wiped the Lunarians out of existence if she wanted to (and probably did before the apollo moon landing to keep the facade up),so i'm pretty sure SSIB and the whole anti-lunarian stuff was made to demonize them and make the youkai look good by comparison.

The lunarians were completely wiped out (excluding the ones living in Gensokyo) around the 50's or 60's. The Sages need to keep their veil up,and use the now-dead civilization as scapegoats.

I'm not sure if Tsukuyomi was erased or not. I'm going to assume that he was,and that prayers to him go to his sister Amaterasu-Omikami.