Basically the stimulus says that it's wrong for the government to restrict liberties. The only instance when the government CAN do it is when people might harm each other. Hope that clarifies the 'except' part...
I would avoid diagramming on this question because it is unnecessary and wastes precious time.
Publish something = liberty
Offend = NOT harm (counterintuitive, but we're going along with this among many other weird situations LSAC dreams up)
Can we infer A? Yes...It is not right to restrict a liberty (publishing) that is offensive (NOT harming anyone)
B- this is just repeating part of the stimulus, therefore not an inference
C- you should eliminate this off the bat, we're concerned with what is right or wrong for the government to do (not what is offensive or not)
D- eliminate for same reason as C, we're not concerned with individuals
E- might be tempting if it said 'It is not right for the government to restrict the publication of literature that does not cause harm, but watch out because it says serious harm The severity of harm is out of scope.
Hope this was a clear enough explanation...