It's harmful in that there exists a significant and vocal subset of users who does not wish to see that content or does not wish their children to do so. It's easier to teach your model never to produce that kind of content than to teach it to perfectly distinguish whether this user should see that content or not. TV channels are barred from broadcasting this kind of content for similar reasons.
Sure, there are always jailbreaks, but then the narrative changes from "we made a model that tells erotic stories to children" to "this ingenious teenager figured out a way to hack our model to make it produce erotic stories." In other words, jailbreak move the fault from the model producer to the model user.
It's also worth keeping in mind that erotica comprises a surprisingly large portion of fiction easily available on the internet for free, and "unfiltered" models tend to produce that kind of content unprompted (see e.g. the original Mistral). The major AI labs are probably filtering it out, but I suspect they can't go too far there, as having a model that is good at fiction is something they actually want.
Then there are the non-chat-gpt-app use cases (like customer support chatbots, automatic summarization etc), for which unprompted erotica is highly inappropriate. Those are the "business travelers" of AI, not the first thing one thinks of when talking about who uses AI models, but extremely important nonetheless.