Sexualization is a tool, it can be used to set the mood and tone of a work, like guns and soldiers can set the tone of a modern military setting. It can be used for characterization, like how scars can be used as visual shorthand for badassery or bad guys. It can even be used to set scenes, like a dramatic showdown sets up an inevitable conflict scene.
Like any tool, the audience can see its use as good or bad, and if it's used badly, the audience tends to criticize it, just like people criticize a mistimed joke, or a poor setting, or inconsistent tone, it is a mechanic of storytelling just like anything else.
The reason it gets brought up so much is that there are a number of people that think it is overused or misused often in gaming, when people see sexualization as something that is used as a gimmick to sell more games, it gets the same reputation as things like Microtransactions, or a modern military shooter setting, people become wary and quick to criticize it because they've seen just how wrong it can all go.
There are a lot of reasons behind such criticism, some argue from tonal and setting standpoint, where in games like Mass effect, you've got a change from 1 where everyone wears whatever casual clothing they want but switches to sensible looking military armor for battle, but in Mass Effect 2 you've got people running around in hard vacuum with just leather straps and clothing that would get you booted out of most sensible military or paramilitary organizations, along the same lines, some see it as tone deaf to be talking to a character (Miranda), and having the cutscene camera giving us sweeping shots of her ass and cleavage while simultaneously trying to make us listen to her serious dialogue.
For others its an imbalance of representation, they see it as something that only really consistently effects women and have an issue with what they see as a game sacrificing consistency and tone in order to titillate male players. Another common criticism is that male sexuality and sexualization is often treated as a joke, you can have Ivy from Soul Caliber walking around in leather straps and the game treats her seriously (or as seriously as a fighting game can treat a character anyway), but a character like Voldo who wears leather straps is basically presented as creepy and bizarre, along the same lines, such male characters are often played off as jokes or very campy gay.
There's plenty of other reasons and arguments as well, I'm sure others in this thread will bring them up, a lot of the conflict in these criticisms is because there really isn't a single convenient target to direct it at, so to some other gamers it looks like games are being criticized for having any sexuality at all. It's sort of like how modern military shooters get criticized, when something is seen as being too commonly used in a bad way, there often are so many examples that they all get criticized and it starts to look like people will jump on any modern military shooter just because they don't like the setting itself. Couple this with the fact that not every criticism is well presented or supported, and you get the current controversy where people fall under the impression that some critics think games shouldn't sexualize anyone ever.
It's a complex topic, and I think there are some valid points to be made about when sex is used well or poorly in a work, artistic freedom is important, but as with any commercial product, so is feedback from an audience that may feel their demand is not being supplied properly as consumers. Artistic criticism is an important component of a healthy media industry as well.