Context is everything

I'm a straight female nudist who loves the subtle erotic-sexual energy that (to me) is a natural part of being nude in public. So it'd be contrary to that attitude if I wasn't okay with arousal being part of the equation. I agree, arousal and the inevitable result of an occasional erection are natural. Personally, I adore penises and definitely enjoy gawking. Far as I'm concerned there are few things more amazing than a gorgeous hard-on, and under the right circumstances I'm not at all *offended* if one happens, and the owner opts not to hide it.
I know how much I love showing and being seen nude, and I don't care what any traditional nudist wants to say about it, there's a buzz of sensuality about it which is undeniable. I always get mildly aroused (at least) from the experience, so I can only imagine the same has to be true for guys. So if I'm feeling some arousal from being nude, I can't deny the same to guys who are enjoying the sensual vibe. From what I observe it's actually rare that a guy is totally flaccid, anyway. At the places I go nude, which is beaches, hot springs, swimming holes, music festivals, parties, etc., it sure looks to me like most of the penises I see are showing the signs of cursory arousal.
But just the same, the occasion is just as rare when I've seen a guy out in the open with a full, straight-up boner. So I gotta assume that it's not *that* difficult to keep it low-key and not be constantly on the verge of having a rager. Am I wrong? Seriously, I don't even know.
So, "not minding" if an erection does happen is different -- for me -- than being okay with it being the norm. I guess it's because an erection is a pretty much unignorable sign of sexual intent. The sexuality of the situation isn't subtle if it's made obvious by the appearance of an hard on. And I'm not saying that isn't sometimes totally okay! It is, and there are those moments where it feels great to dispense with the subtlety and be more open and honest with it. It feels especially good to admit that half the point of getting nude with one-another is to relish the nourishing deliciousness of the sexuality.
One experience I've had with it stands out (no pun intended LOL). I was at a hot spring resort and had met this guy. It was middle of the day and we'd been chatting and just kinda casually hanging-out for a couple hours or so. We got along really well, had a lot to talk about. He was a really cute guy and we were having a good time getting to know one another. Later in the day we'd been apart from each other for a while, and then we randomly were walking toward each other out by the main pool. We stood opposite one another, chatting again, and while doing so he started to get an erection. It happened slowly and by the time his penis was standing straight out I could tell he was feeling awkward about it. We were standing very much out in the open, in full view of the entire bathing/sunning area at the resort. And at that point he obviously lost control and hit a point of no return, because he very quickly experienced a full erection, right there in front of me. And there was something about the whole interaction that struck me as precious. Like it really did seem completely natural -- nothing wrong with it at all, like it was nice to know he was attracted to me and turned on from seeing me naked. He had a really nice penis and an even lovelier erection, and I enjoyed the opportunity to see it. There were no negative reactions from anyone despite it being so visible and obvious -- like, the sky didn't come crashing down or anything.
I've had tons of other such experiences over the years, where it's just not been any kind of big deal and -- in fact -- totally natural for erections to occur. To me it feels better if there's no arbitrary prohibition on it, but also if guys can manage to gauge the context and try to avoid being over the top with it. I just like it better if it doesn't have to be a point of awkwardness or embarrassment for anyone.

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