A few days before Christmas, Blue writes that he came home from school to find both his parents at Blue's mom's house, which is an extremely unusual situation. Blue was terrified his mom told Blue’s dad he's gay, but when it became clear that she didn't, Blue decided to tell his dad himself—but then he couldn't because his dad said that Blue's stepmom is pregnant. Blue signs off his email using "love." Simon tries to make jokes, offers congratulations if Blue wants it, and suggests that Blue's dad admitting his wife is pregnant is the adult equivalent of coming out. Simon suggests that everyone should have to come out and it should be painfully awkward for everyone.
Simon's suggestion that everyone needs to come out expresses a desire to eliminate some of the assumptions that people make about each other. Then, by recognizing that it was surely very difficult for Blue's dad to share that his new wife is pregnant, it suggests that both Simon and Blue are learning to empathize with others and recognize when other people have to do difficult things. This announcement also shows how even Blue's family is changing rapidly.
Blue very much appreciates Simon's humor and admits he's not too upset about having a stepsibling. He agrees that it's annoying that straight and white are the default, and seconds Simon's suggestion that everyone should have to come out. Simon replies that he hopes the baby is a boy, citing his own experiences with sisters as his reasoning. He explains he had a weird day but declines to give more info, and the conversation devolves into sexual innuendos. However, in Simon's last email, he suggests that they should meet in person.
Though Blue's comment about the default being straight and white is definitely true, it's also worth questioning whether Blue is simply a very perceptive kid (especially since Simon hasn't made such a leap) or if he knows that this is the case from experience and isn't actually white. When both Simon and Blue try to be happy about Blue's future stepsibling, it shows them trying their best to embrace familial change.