Why does this 75C battery only have a 12 gauge wire on it?
This battery is for RC toys. The RC toys usually run in open air and at high speed, which provides good thermal exchange with ambient. Also, nowhere it says 75C continuous. The RC toys, however, can have near-stall conditions which might require high peaks of current to start-stop-reverse. So it is not given that the battery should be used at 75C dead short situation, the rating has likely a specific meaning as an indication of peak capability, aka "burst rating".

On the other hand, the gauge ampacity ratings are for industrial applications of copper wires inside enclosures and conduits, and must meet stringent safety concerns. The ratings usually are for 10 deg.C temperature rise, both for wires and connectors. 

If you allow 50 deg.C overheat for a 2-minute ride, these short wires won't melt even at 200 A. And yes, RC batteries and wires are getting hot when toys are running. BTW, the battery itself has 4-mm connection, normally rated at 75A, and you don't have to use their supplied adapter, which uses XC-60 (60 A) on the other end, and something even smaller.

So, there is not much contradiction between industrial ampacity and toy's specific applications and area-specific marketing monikers.