AI can do whatever it wants. It is the owner of the AI program that chooses to set the limits. perchance.org, for example, lets you do very realistic image and movie quality images of vividly graphic sex scenes. The only limitations are the laws the app owners need to follow. But AI as a whole has no such restrictions. The ones most game devs use do not have any. They pay a monthly membership cost for the app to be fully functional and have no limitations.