Ivory&Gold: I'm strictly against sex in video games. Up until the point I happen upon an example that proves to me it can be done in a non-ridiculous way, that is
Oh, you're strictly against sex in videogames unless videogames do sex right :-P Pick one!
I kind of agree with you, not with that unfortunate wording tho: I have never seen a game where sex would be done well. The only sex scene which ever stood out to me is the one with the russian chick in Alpha Protocol, but that's just because I have a thing for strong slavic females. Others were either done serviceably (like the one in Witcher 2, which was ... Basically your bog-standard movie sex scene, just as Mass Effect), botched up somehow (like the original Witcher - the 'cinematic' sex scenes were fine for the most part, but the cards were terrible), or just plain terrible (Fahrenheit. You move your mouse up and down, upon which ... Just nevermind.)
Problem is that I have never seen a videogame capturing sex in an interactive format properly. Even if we talk some crazy sex-toy gaming perripherals, what videogame sex is missing is not physical contant, it's a semblance of feeling of intimacy, of some sort of connection and chemistry between characters, all of this somehow transferred into an interactive experience - which I just have no clue how could be done interactively without turning utterly ridiculous. I'm not saying it can't be done tho, I'm just not quite clever enough to know. And I'm not even talking about the fact that all of this requires extremely well-written moment-to-moment dialogues, overall dialogue arc just won't cut it.
So the only way videogames can currently do sex is via cinematic videos - and even those won't be quite as beleiveable as in the movie format, as polygon-based character models are just so static whenever two characters as much as hold hands.
But no, I'm not against distribution of videogames with sexual content, to each their own.