It’s hard to say who knew what when about Bill Tilden or what they may have heard. It sounds like the rumors and suspicions really spread after his 1920s heyday when his career was already in decline. After Tilden was arrested in the 1940s, he was ostracized. Nobody would have anything to do with him. So he may not have been an example of a homosexual accepted in the sports world.
Certainly in those days and many years after, open homosexuality was not accepted and probably punished. Nevertheless, many people in and out of the world of tennis either knew or suspected Tilden was a homosexual, but there was no effort to punish or ban him from tennis tournaments. Ty Cobb watched Tilden play one time and exclaimed “who is that swish?” or words to that effect. Tilden was still playing competitive pro tennis into his forties. He even played in the U.S Open at the age of 53 in 1946. Tilden was ostracized after being caught with an underage boy later that year and spent time in prison. Then he was shunned by the tennis and sports world. In the early ‘70s, Frank Deford of SI wrote a long article about Tilden.