Word or phrase for describing something negatively but only lightly to detract from how bad it really is

gloss over

to avoid considering something, such as an embarrassing mistake, to make it seem not important, and to quickly continue talking about something else:

• She glossed over the company's declining profits.

(Cambridge)

M-W defines it as meaning

to treat or describe (something, such as a serious problem or error) as if it were not important

The substitute word or phrase is a euphemism. Using one is, adding to the suggestions already offered, downplaying the problem when there is an attempt to partially conceal or redefine the effect of a negative fact, or softening when wanting to convey the truth without being harsh or crude.