So you don't believe a superior (her manager) was wrong to insinuate a question of whether she would participate in his sexual life?
What if she didn't complain to HR, rebuffed his advances, and he subsequently decided to demote her position, or cut her pay, or even just move her desk out of an office and into a cubicle?
Would it be alright then?
Bringing sexual advances of any kind within a situation where there is a power difference (ie, manager vs lower-level employee) is a recipe for disaster within a company. Ideally, it has nothing to do with being too sensitive about things sexual. While I'll agree with you that, in many cases, American views and such on sexuality are messed up, in this case it is pretty clear why this kind of thing isn't tolerated.
Between individuals on the same "level" within a company is one thing (but still frowned upon and should generally be avoided); provided the advance is innocuous enough (ie - asking for a date, for instance), and it isn't repeated if rebuffed - and the individuals aren't in any power difference (C-level to management, management to lower-level employee, etc) - then it may be permissible.
But even here - if I was an owner of a company - I would want this to be verboten, for the simple reason that should the advance be rebuffed (or worse, things go great - then something happens and things fall apart) - it can lead to strife between employees (at a minimum, the two involved, but it could easily lead to "side taking") - which can harm productivity, cohesiveness, and ultimately the image of the company should it become public knowledge.