The problem with sex-on-loss isn't really sex-on-loss as such, it's the motivations of player and PC not lining up, causing narrative dissonance: Player wants hero to get laid, hero wants to be a hero, getting laid is getting in the way of that. Narratively that either requires corruption-like mechanics (which get out of hand and banal quickly) or the hero being bad at being a hero, and that's not cool, but there's a rule of cool so that's lame.
So it's good to be careful with that kind of mechanic but OTOH, personally I wouldn't rule out sex-on-loss completely, but use it when appropriate, when it makes an enemy narratively interesting, when it adds variety. Make sure that it's not a reward the player is seeking. Like, make it a wrong kind of sex, an inconvenient kind of sex, boring kind of sex, sex that isn't exclusive to a lose condition so there's literally no incentive to lose on purpose, you could just *ask* and you'd get fucked twice as hard with twice as many options, or win and get fucked thrice as hard. Always have a carrot of more of what the player wants which can be achieved by winning, but don't limit yourself in the sense of "no enemy would ever take advantage of our hero" as that can get into the way of having interesting enemies. The stick doesn't need to be a stick, it can be a smaller carrot.
