Assassin's Creed works on a basic premise which one can largely ignore, if more focused on action and a quick completion: one is tasked with investigating targets and learning about their activities in their respective cities. This usually centers around what they do or an event that will take place; along the way the player learns the placement of soldiers, scholars with whom to blend, and the location to which one must head--in-game solutions to the larger puzzle of how to assassinate the target. Naturally, along the way one learns a lot about the intended target's life, their goals, and their fears.
Much like any of the other targets, Abu'l Nuqoud, a corpulent and opulent merchant king of Damascus, represents the entirety of the real-life Knights Templar and their eventual fate. In particular, among the heresies leveled against the organization were accusations of sodomy among the men in the order (alongside devil worship, naturally--the two often seem to go hand in hand when accusations fly). While it is not because of Abu'l Nuqoud's implied sexuality that he is assassinated, it serves as an impetus for the reasons why he seeks revenge on those who speak ill of him.
Implied sexuality, only, however. The game dances around the issue and never decides to plainly tell us that Nuqoud is man-loving. Instead, the player gets implications of having a peculiarity which leaves him with shame, and besmirches his name among people. This is vague enough that I merely raised an eyebrow and wondered if he had a particular deformity (as a friend and I discussed, we thought the culprit might be leprosy) that people found abhorrent. However, it all came together for me during the last block of memory with Nuqoud that is unlocked:
Around the 3:30 time mark in the above video, one sees Nuqoud, in a very brazen and tongue-in-cheek manner caress one of his guards. It's notable due to the fact that there is very little touch in the game that is not forceful: Altaïr uses touch to push or tackle people out of his way, and you'll see characters attacked (this being a primary aspect of the game and insinuated in its title), but an actual gentle touch? The only other such occurrences are after Altaïr has assassinated one of his victims and holds them in his hands as they pour out both their lifeblood and philosophies. This is one of the only touches that communicates no violence to its recipient, and therefore stands out for its implications of gentleness.
As for Nuqoud himself? While his homosexuality is implied and brought up as a scandal among his peers, it does not inform his entire being. If anything, as Altaïr finds during his investigations, Nuqoud's flaws point to his more classist beliefs that the poor and uneducated are contributing to the ills of society--he sees a problem to remove, rather than fix. Therefore, his actions of poisoning those at his fête and having archers standing to shoot any still living speak as much to his belief of creating a world where his sexuality can be accepted as it does to his belief that there needs to be a rather high standard to which all humans are held; whose standards do not include heteronormativity.
His words during his death scene (also in the above clip) are also poignant, however:
Abu'l: Look at me. My very nature is an affront to the people I rule. And these noble robes did little more than to muffle their shouts of hate.
Altaïr: So this is about vengeance then?
Abu'l: No, not vengeance-my conscience. How could I finance a war in service to the same God that calls me an abomination?
Like many of Altaïr's victims, Nuqoud's death brings up questions that propel the final confrontation of Altaïr's own beliefs and order. Instead of just being a one-note villain, there is nuance available to his motives, there are reasons for his decisions, and there is a human who is making decisions based off his own desires, not just an ideal as grandiose as an overarching good and evil balance. If anything, good and evil really don't exist in this game, the two sides being instead being waged on power and how it should be used. He's not just typecast as a villain, nor merely a victim.
As for his representation as gay in the game itself? He is by no means a stereotype of the lisping, limp-wristed fairy, and I would be hard-pressed to name him in one of our contemporary scenes. Nor is he completely in denial of his sexuality or defined by his bedroom actions, even if the game is rather mum about it. Given the circumstances of the game, his touch is loaded with meaning, and while it is by no means two men kissing, I have a hard time envisioning any kissing scenes occurring in Assassin's Creed (as much because of the engine, as that the first game's romantic tones are all but mute); that touch he delivers serves as the most kind of the game (even if lascivious).
The one aspect that makes me raise an eyebrow is his level of nonviolence, as he's the least hands-on character you are sent to kill in the entire game. He initially runs from Altaïr, not engaging him in combat. While this is attributable to his class status and position as merchant, there is at least one other merchant, a scribe, and a doctor who do engage in combat. However, in the larger scheme of things, he is a fully enough fleshed out character that it seemed more in tune with his entire depiction of a character--one who orders and plots, but has no desire to sully himself with more base actions.