i think everyone deserves to be told WHY. And not left hanging, wondering what happened. What did they do. There is nothing to fear in telling the truth. So long as you are not coming off rude, or judgmental.
just tell her that you do not want to judge or disrespect her in how she chooses to raise her kids. And hope that she will respect your choices in regards to your own kids. Tell her, "your son has semi-nude pics on his walls and makes sexual remarks/actions (be very objective in your words)." Just want you to know that WE choose not to have our boys do any of that."
Don't say, "your son has 'inappropriate' pics on his walls" because that's where it comes off judgmental. Since, maybe it's inappropriate to you, but not to her. <rolling eyes> hahahah. So let her know that you don't want to get involve, nor discuss this subject any further.. because it's not really your business. But you ONLY mentioned it this one time..so that she will understand why you do not agree to a sleepover. And to give her the respect that she deserves..the respect of knowing why and not just be blown off.
And hey, if she's mad at you and stops talking to you. Well, that solves your problem.
Hope this helps.