Not everyone is a fan of the mosaic censors in The Sims -- which is why it was only a matter of time before someone modded them out.
If wild The Sims 3 mods are any indication, this is just the tip of the iceberg -- and we're bound to see a bunch of other nudity/sexual mods in the future. But for now, there's this "No Mosaic" mod which uncensors your sims while they pee, shower, breastfeed, and streak. That means you can see your Sim naked sometimes, at least briefly.
Mind, sims are basically Barbie dolls underneath the clothes -- Maxis didn't render any details. That, too, will be fixed by mods at some point, I'm sure. For now, we have this mod, which reveals that dude sims have been pissing right into their hands this entire time. Gross!