It has nothing to do with the rating boards anymore. Nudity is M rated. They've had a few games in the past few years with floppy [censored] for jebus sake. Nudity, at this point in a game, has more to do with if the developer is comfortable with it and a lot of them shy away from it like it'll destroy them. I can see doing full frontal via no clothing on having issues do to players being able to manipulate dead bodies and the like though. That's about where I think it would kill it for this type of game. The older Conan approach of topless and g-string would get around it but that's still a bit awkward.
Just 2 primary examples but Red Dead had a topless women 'while' she was getting plowed directly on screen 'while' you talked with the guy who was giving it to her. And the more recent Noir game had an awful lot of naked dead women in it halfway through. Full frontal naked dead women. Hell a lot of that game was crazy messed up but that's kinda part of the job.
Anyways, point is, they aren't doing it cause they don't feel comfortable doing it, or there still scared of the rating board even though its accepted and would earn them the M rating they already have.
^This. Not that I am advocating anything as extreme as some of the examples cited, but you make the point well. As wrongheaded and backwards as the rating boards and culture are, games don't get insta-banned or advlt rated just for having partial nudity or implications of sixuality. And it doesn't tank their sales (See Fable, the Conan games, God of War, etc, etc,).
The devs have shyed away from nudity, by their own choice, while simultaneously putting significant effort into implementing features that allow players to desecrate the bodies of their foes, slaying them in over the top, graphic, gorepormographic displays. In doing this, the devs have not only bowed to and tacitly lent support to some of the most ludicrous standards in the industry/ratings system, they have also made an implicit judgement call. . . that gratuitous gore is somehow more appropriate than nudity.