actually its probably not for the purpose of increasing sales, its mostly because this was the sensibility of the game they wanted to make. its not like all adult games sell better than non adult games. Its just a case of this creator wanted to create this type of experience.
20 years ago was a different society, games had a different audience, and different expectations and people had a different culture. Its interesting because many of the things you mention show that before they unrealistically ignore things to match the cultural sensibilities. There is no realistic reason you don't see the balrogs sex organs, its just that society would feel uncomfortable. Previously they might tell the same stories, but obscure parts of it, just to match the culture. That hasn't changed, the culture has simply changed.
That said, Instead of trying to make a claim about what is artistic, realistic, or moral. The best argument imo would be allowing people to set the game rating, so that users can avoid these racy things if they prefer. Its valid to acknowledge different players have different levels of what they want in entertainment.
