It isn't so much that they're offended, but many company internet policies (including mine) have a certain "taste" code that they follow. (for lack of a better term) If the company administrator sees something which in his opinion is in "bad taste", he can put a block on the site, regardless of the full content. Up to this point, I'm free to browse during working hours, and I think the avatar rule helps my situation as well as others'.
(yes... I too enjoy giant full-motion bouncing exposed breasts, but I'm happy to give them up for continued Sioux coverage)