My understanding thus far is a number of not safe for work games had been removed from Steam, but they have not done a 100% ban. At least not as of yet. Like Itch, Steam is running into problems with new rules with the companies that handle payment services of they will allow their services to be paid for.
On top of that Steam got a fair amount of negative attention for one particular game called No Mercy. Because apparently the whole point of the game was just literally cruel brutal sexual violence as I have come to understand. The No Mercy incident I think made Steam realize they probably should do more vetting of some their not safe for work games they host on their site.
The No Mercy incident combined with the current struggles of the new rules from the company that handles their payment services is what lead to changes on Steam and some games being removed. There are still some not safe for work games on Steam but what can and cannot being allow is admittedly in a state of flux at the moment. Or at least that is my current understanding of how things stand.