I agree kids and social media are an issue, Rep Ed Markey has recently introduced a bill to try to deal with marketing on the internet etc being targeted to kids and companies collecting kids' info to market to them. He wants to make it harder for companies to do both. I talk about it in my last ep of Dem Kicking Ass podcast. (You can check it out on my profile lol. Not a shameless plug I swear) and sexualizing of kids is an issue as well. Again however, that specific behavior has been problematic in media before social media, social media just magnifies it. As far as why do extremes become more popular on social media, because extremes drives clicks and people want clicks and marketing firms want clicks and influencers who monetize their content want clicks. Extremes drives the Pavlovian part of our brain to go "Oooh drama must read!" You can have the exact same article one with a clickbaity headline and one without out and you'll see an immediate difference in reads. That is human psychology, nothing new there. Tabloids have known that for decades.
Yes there are shades of liberal and conservative and there always have been. The issue isn't that there are shades or that people don't want to discuss the shades, it's the caliber of the politicians that the GOP especially keep voting for and their platforms which are incredibly harmful to people and ignore things like climate change. I have no issue with rational conservatives, hell I love Elizabeth Warren and she used to be GOP. I take issue with conservatives as a whole continually choosing to deny science and facts and culturally dragging us back to the Dark Ages.
Is there an over reaction on the liberal side in some social aspects? Sure. But a great deal of that comes from people being targeted with hate and bigotry for so long in the case of LGBTQ issues and the rest of it is the increasing denial of basic science and outright refusal of facts that the rest of us have been dealing with coming from conservatives years now.
Does social media screw with your world view? Sure. And as you said it is a tool. My main issue is that people as a whole have a tendency to blame everything but themselves for how bad things can get. Marketing has been around since the first time someone tried to sell something. Is it much more nuanced and targeted now? Sure. But just like the old school shady con men, if people learn to critically think it loses its power. That's what lacking these days, is critical thinking.