All about the Profits
Sex and violence are two of the biggest draws that filmmakers use to create high grossing movies. We also see the use of violence in nearly every single online video game. Why then, do we not see sex implemented into online narrative games?
The most obvious is reason is an economic one. Games are made to be sold and to make money and games that appeal to a broader general audience are capable of making a larger profit. Games with sexual themes and content carry a mature rating that prevents the younger gamer base from buying or playing the games. That means less money. And for some reason, our society has decided that sex is way more controversial than violence, and should be censored even more so. That part is simple.
The other reason we don’t see sex games flooding the market is because of the inherent difficulty in making a sex game that people would actually want to play. A game of destruction and killing is easy to make: adds guns and blood. Done! People are intrigued by this because they don’t ever encounter violence like that in their own lives. Sex, on the other hand, is a unique experience for each person and would have to be treated as such in a game. A narrative game about sex could only possibly appeal to a small fanbase. People have such different tastes in terms of how and when they have sex, the type of people they are attracted to and the emotions that go into having sex. It would be extremely difficult to design a game that allowed for every to have sex the way they wanted to in it. Its not like Halo, where everyone can just let go and shoot em’ up.
Narrative offline games based on sex have been designed and done moderately well such as Leisure Suit Larry and Playboy: The Mansion. So it really is only a matter of time before developers figure out a way to get past the current barriers and make an online game where going to buy a condom is a quest worth 30 XP and having sex is the ultimate 3000 XP.
-Thediesel

I wonder how much revenue those two game titles generated as standalone play titles? Isn’t that having sex with yourself in a game?