Flagged posts appear to everyone, instead of being hidden for users who aren't logged

I think you may be able to target them with a little CSS. If you had the CSS Classes for Current User's Groups theme component I think you could do something like this:

.post-hidden {
    display: none;
}

.group-trust_level_4 .post-hidden {
    display: initial;
}

You may need to tinker with it to get the results you want though, depending on staff trust levels or category moderators, etc

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