What king of violence, what kind of sex? Jumping on turtles heads in Mario, fouling and injuring people in sports, and so on, isnīt that violence as well? As for sex, do you mean those funny scenes from Bioware or more primal scenes from eroge games? In my opinion, it all depends on what king of game are you talking about, and mainly, what kind of person you are. If you are disgusted by simulated killing and sex, donīt play games containing violence and sex.
Neither are inherently bad even when overused. Children will mimic everything anyway, if they aren't taught differences between real things and games early on by their parents. Some of them even grasp the difference on their own. And because many parents lack this sort of education ability, there won't be AO-games available via retail or supported by system developer. You know there is something wrong, when developers (even bigger, more known ones) cannot add things they originally wanted due to pressure from various peers.