I absolutely hated the She-Hulk ending, I would like to ignore it and it hurts me that this would be how the MCU reach Tier 1, but unfortunately I have to agree with the upgrade.
The Reality-Fiction difference is established pretty clearly, with the entirety of the MCU, including it's Multiverse, being fictional in the Real World, and K.E.V.I.N. itself is the creator of all of it. Which would mean he created and have complete control over an infinite Multiverse, viewing it as fiction that he can manipulate as he likes. The ontological difference is clear here.
And its not a simple gag. A gag would be something that doesn't affect the story, while here K.E.V.I.N. is the Deus ex Machina, the one that modified the ending to reach the conclusion of the show. So it's an important part of the story, unfortunately.
And if someone have doubt about the fact that in the Real World humans are just humans, this is what Ultima said in the Undertale Low 1-C downgrade thread:
"The Low 1-C rating would be off of their own ontology, and not the amount of influence they are able to exert over a lesser plane. That's a point I brought up in the last thread: You can be Low 1-C or 1-A or whatever and still have limited influence over lower worlds (As well as no such influence over your own). It makes you a very shitty Tier 1 but does not invalidate the tier altogether."
In this case, regular humans have limited influence over the lower world of the MCU, while K.E.V.I.N. have basically full control over it. And neither have really much of an influence in their own dimension.
Overall, there already are numerous author characters that classify as Tier 1 or higher (look at the Writer in the DC cosmology, which is not much different than K.E.V.I.N.), so to refuse this upgrade would mean that the standard should be completely revised, since otherwise it would be a double standard.
So, in conclusion, it pains me to admit it but Low 1-C is legit. I just don't like at all how it was reached, but it's legit.