Apple has stirred up yet another controversy over its often arbitrary App Store app rejection process. To all appearances, it has started purging all applications with “overtly sexual content” from the App Store.

The news first appeared when app developer Chillifresh discovered that its Wobble iBoobs application had been removed from the store. It reportedly received an email from Apple stating, “We have decided to remove any overtly sexual content from the App Store, which includes your application.” So far, Apple isn’t explicitly confirming that it’s removing all sexual apps, just saying that it removes inappropriate content when customers complain.

But it looks like there’s a real purge underway: TechCrunch found that some erotic apps have been removed, while others remain available. The Playboy app is still there, for instance, while several Maxim apps were removed, as pointed out by Business Insider.

This just gives more ammunition to the many critics of Apple’s App Store policies, and reaffirms blogger John Gruber’s assertion last week that the App Store is one of Apple’s biggest issues. If the store is supposed to be the primary means for getting content onto the iPhone (and soon the iPad), this schoolmarmish-ness really cripples those devices. And boy, won’t it be fun if Apple decides to police the iBookstore in a similar way.

On the other hand, if company goes through with it, I guess this will be one area where the mobile web has a definite advantage over the App Store — assuming those mobile web sites don’t run in Flash.