Quite frankly I don't see what the photographer had to complain about, you can't see any tit, I certainly don't find it offensive in any way. I don't see the person in the image being degraded. However had it been a child then I could see it being a problem.
It's not really the photographer complaining, but worrying about the people he photographed. I think it depends on the person. Many people here in the bible belt would be very offended by being photoshoped into a flyer for a strip club (even the hypocritical ones that are their on Friday night and in church on Sunday morning).
Hypothetically, wouldn't you be upset if someone took a photo of your family and photoshoped them into a flyer for a strip joint?