I'd say Gay Tony Prince from GTA IV The Ballad of Gay Tony is a good representation because it doesn't feel as pandering. Despite being a stereotypical middle-aged gay guy, he shows some depth and development by how troubled he is. Despite that, I don't feel as there's enough representation of the LGBT community on videogames, particularly on protagonists and/or playable characters. Take Piers Nivans from Resident Evil 6, for example. In Resident Evil Revelations 2, he sends a letter to Claire where he subtly reveals a bit too much admiration for Chris, but he doesn't feel like revealing his true feelings to the player. Come to think of it, I could draw a weird comparison with real life by saying there are characters who are closeted towards the players due to the extreme toxicity from segments of the audience.
I think there are a handful of LGBT characters in games, but there's a lack of protagonists who are either gay or lesbian. One could argue that certain RPGs allow you to create your character and give him or her that kind of identity, but to my knowledge there's not a well known protagonist that can be considered gay. However, even if I would like for a gay protagonist, I feel it would unleash a lot of backlash from the community. Either he's pandering, or he's a gross stereotype, he's extremely bland, an insult for the LGBT community, etc. It's not like I'm desperate for some representation on gaming, but developers should push the envelope on the way they make the games.