They are arguing to be protected from 230 that they have to be a public forum (free speech) they can't have the cake and eat it too. If they want to truly limit free speech then they have to give up 230.
The lines between a platform, a publisher, and a distributor are not well drawn from what I have read. So while an argument can be made that moderation means going from a platform to a publisher, I think it would be a bit of a tough argument to make on a number of levels and isn't clearly established. To decide such a case in which FB or Twitter overstepped the line they are going to have to first draw a line and that, to me, seems an exceedingly difficult line to draw.
The thing that worries me is what kind of precedent could it set? Might it scare companies from every moderating? Might it prevent companies from ever starting? The ramifications could travel far and wide if section 230 is done away with or interpreted in such a way that moderation is seen as becoming a publisher.
Most platforms, even 2ahawaii has some level of moderation but imagine this forum lost their protections under section 230, they could theoretically be sued out of existence.
Personally if Facebook or Twitter, or any such platform decides they want to become an echo chamber and only allow certain voices/messages then I say let them. Let the free market do it's thing and have the next Facebook come out provide a better service.