A big example is America, Asians, Africans, Latinos, etc. have created wonderful food and created new traditions to adapt to the American environment. So why can't Genshin do it?

Overall Genshin is a fantasy game, it's not real life. Whitewashing or Cultural appropriation has been thrown out a lot but in reality I don't think Genshin is trying to erase culture they used for reference but mixing different ideas to create something new because that's what sharing culture is

I'm not saying the designs are good, I'm just saying that Genshin consistently uses modern clothing for their characters and sprinkles in some traditional and cultural accessories or designs like Eula's hair being a lovelock or the patterns in Gorou's sleeves and pants.

In Inazuma: there's Kokomi's bikini(?), Gorou's 'armour' and Ayaka's combo with dress and armour
In Liyue: Ganyu, Shenhe, and Xianyun's bodysuit, Keqing's cocktail dress and Yanfei's lawyer outfit
In Mondstadt: Sucrose's dress, Mona's swimsuit dress(?), Razor's coat and Jean's tights

In Fontaine: Chevreuse is not wearing a typical musketeer uniform and Navia's shorts-dress with elements of historical dresses but adjusted because of clipping issues(lol)
In Sumeru: Alhaitham's body suit Faruzan's dress and Tighnari's hoodie

But I do agree that the skin colour part is very unfortunate and the character design doesn't sit well with me it's a jarring contrast but then again it's happened with every nation

The weakest argument I've seen is that it's too colourful. Colourful?!? Meso america and Africa are known for their bright colours! The graffiti on the walls are very visually stunning but I don't hear complaints about Inazuma's purple, Watatsumi's pinks and lavenders, Chenyu's atomic greens & blues

Aztecs were ahead in their time with technology and they represent it with technology in the real world, Natlan is at war constantly so it only makes sense they're super advanced in technology WWI and WWII really pushed the limits with technology

Y'all look at the motorcycles but look away that Fontaine has guns and coloured movies, Sumeru literally had Internet and the existence of the waverider, Inazuma having a fucking Chernobyl crisis and the plastic cups from Barbara SQ and Ayato's idle

It looks very unique and different, people hate it because they're not used to it