The extension supports over 500 sites and needs to modify the page to show the paywalled content, so the permission list includes over 500 domains. There’s no good alternative to these permissions. You can inspect the source code to verify that the extension’s behavior is legitimate.

This browser extension bypasses the paywall.

The historical context is not the same. The watermelon stereotype is an anti-black racist trope from the 1800s that arose from resentment against newly emancipated former slaves. It accused black people of being “happy to do nothing but eat watermelon”. In comparison, the stereotype of white girls enjoying pumpkin spice doesn’t have the same negative connotation.