In order to maximize the fun, I think you should avoid Insta-Gone clothes and Mind Control for this particular series. Technically, there's nothing wrong with it, but it really eliminates any suspense or anticipation.
As far as sex goes, I'd just recommend you just stick with sexual themes. I thought that it was perfectly fine when you alluded to it in the 1st story, as it added some suspense. However, if the loser of a battle gets her wand shoved up her ass (for example), I think that's perfectly fine (and awesome). So, I think some mild "toying" can add to the humiliation without being full-on, hardcore sex. Does this all make sense?
And, you mention watersports... the rules forbid it. I'm not sure if contestants pissing themselves counts, but in the right context, I'd have no problems with it. However, I don't make the rules, so tread carefully!
And, for me in particular: Bondage, spanking, lite S&M = yummy goodness! But, if the majority of readers hate that, then you've gotta do what ya gotta do.
Good luck, and happy writing!