First of all, YOU are assigning Milo to the 'alt-right", thus falling into the tactic you are denying. He's a gay guy, and the guys you lump right leaning people into, the actual white nationalists, probably don't have anything good to say about gay people, especially flaming ones like Milo.
Second, your definition of "inciting" is basically "Milo said some mean things, then Milo's followers said some meaner things, so lets ban Milo". I have a feeling plenty of SJW's can have the same thing said about them, but when lefties do it, its not hate, its "passion".
Now you're making assumptions about the #AltRight folks. When Milo got banned, they're the guys that got the #FreeMilo hashtag trending, raised the ruckus, and made a fuss. They see him as one of theirs and he's both written in their defense and has been seen as a leader in the movement. He's one of them.
As for why he got banned on Twitter, that wasn't my call but the folks that did have to make a decision made the call to ban him. There was a pretty clear through line from him to the harrassment Leslie Jones faced on Twitter, and still faces now. And it wasn't just mean stuff. She's had her phone hacked, been doxxed, had her website hacked, had personal photos posted online, received death threats, etc. We'd hold Islamic Mullahs responsible for cyber attacks if they called for Muslims to harass someone, the standard here is pretty similar.
As for the #AltRight as White Nationalists? I'd debate that. There's some White Nationalists in there for sure, but the majority of the movement are pretty much assholes first and last. Most of them act like a five year old that's learned a curse word. They're casually cruel, racist, and misogynist. That overlaps with some of the White Nationalist folks but they're actually something different but every bit as repulsive.
BTW, on Twitter SJW has become one of those words I'll auto block on, as well as virtue signalling. It's a way to make "standing up for others" into something weak and laughable. A fair amount of folks that'd be labelled as SJW got killed in the 60's and still get killed under despots today. Nothing wrong with taking a stand for what you feel is right.