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That is just as ridiculous imo--quite possibly even more so.
At some point some link for some product is going to potentially lead to another link, and that might lead to another link, and eventually that link might lead to a link where something potentially "sexual" is shown (in this case is was literally just a painted image of a bare *ss an nothing more--God help the children!). That's the Internet for you.
But you shouldn't be banning an ad that in itself is not showing any nudity whatsoever for being "explicit". That's just stupid.
And, as many people have already pointed out, you're apparently totally fine with far more "explicit" stuff being advertised directly on your site--so long as someone's paying you for that privilege.