If you are on
lady-spaz's flist, you probably already read some of this, but I wanted to re-edit it and expand it a little, because that and some private IM's I had with a couple friends helped me clarify my thinking on this subject.
N.B. I am using the word "queer" throughout this essay to signify all varieties of non-heterosexual orientations.
I've had several interesting conversations about the social issues surrounding sexual orientation in the Naruto world, today, specifically with respect to my writing and the RPG's I'm in. I play a fairly libertine young Genma in
Scarlet Spiral, who's bisexual by inclination. He is well trained in seduction techniques and is often called upon to use them in the course of assassinations, most often of gay men. I also play a straight but literally sadist Ibiki there, and a straight Hayate and queer Genma at
revanche_rpg, and a straight OC named Kamizuki Kazushi at
shadesrp. In
my fanfic, in addition to writing about the characters and relationships from my RPGs, I've written a gay Raidou in a monogamous relationship with a bisexual Genma, and a fair amount of Kakashi and Iruka as a couple. To be clear here, I'm not a porn writer. In most of my stories the sexual relationships are incidental to the drama.
My vision of the Naruto shinobi world is that while innate sexual orientation is still the driving force behind sexual relationships, there are few social barriers to homosexual relationships, including long term ones. I see the shinobi world as very much more accepting of the idea that whom you sleep with, when it isn't for a mission, is your own business; sexual orientation is not a controversial issue socially. Ninja often die young. "Live for today, for tomorrow you will surely die" is taken very much to heart.
On the other hand, I also think there are some people in the Naruto world who don't find queerness acceptable socially, and even for those that are not bothered by it, there is still the assumption that most people they meet are straight, and most straight people would not want to be queer. It's still harder to be queer in that society than to be straight, because queerness is still the minority. I think the proportions of queer people in the general population in that world mirror our world, with 80-90% being straight or mostly straight. So even though there is more freedom to form gay relationships, it doesn't make them more common, just less hidden and stigmatized. And while socially it might be acceptable in shinobi society for people to have homosexual relationships, it will still come down to, ultimately, what each individual feels in terms of emotional and sexual desire.
It's a nice, idealized world view, really. I wish it were as simple in the real world as I've made it in my writing.