Frankly, if I were in Sir Elton's shoes, I would not only have pulled the exhibit from the gallery, I'd sue them for the value of the image, if the police retain it. The gallery had no business doing that. If the gallery manager was concerned about the image, the time to say something about it was during negotiation of the loan with Sir Elton, not after the show was hung on the wall. It speaks of several cultural phenomena - moral busybodyness and the cult of celebrity. The gallery manager must have been so star-struck at having "Sir Elton" loan them work that they either just said yes to anything and everything without question just because it was Elton, or they turned a blind eye when agreeing to the show because having Elton John's name associated with the gallery would be a big boost and loads of free publicity. In either case, it is a huge betrayal of trust, and if I were a major collector of art with a collection to loan, you can bet that I would NEVER loan works to that gallery, regardless of content.
That said, it isn't an image I would ever have bought, or an image I would ever have made. It makes me squirm to look at it, but then perhaps that's the point, and as such it succeeds as a work of art, because it makes you think. I don't like it also because it is a high example of the "artless art" mode of photography, in which cult Nan Goldin is a high priestess. I think it feels more pornographic because it is so artless and amateur in style, so it feels like a polaroid still from a 70's porn set, kind of like that series of ads Calvin Klein did for either his underwear or for a new cologne back in the 90s, where he had what appeared to be teenagers essentially stripping for the camera, in front of some cheesy faux-wood paneling, while taking direction from an off-camera voice (incidentally, the man providing the off-camera voice was in fact a porno director). The ads didn't last very long at all - I think they ran about 1 week, then got pulled over the controversy.