Killak from the GameFAQs boards describes it thus:
The minigame was undoubtedly cut to ensure the game received an M rating.
It has been speculated that the dildo gift item was intended to tie in with this mini-game, but because the minigame was never finished, the dildo remains unused. The nude version also speeds along the dating process every girl can be dated at any time and right from the start of a new game so that players can try the feature out at any time and as quickly as possible. On the XBox and PC versions, 'nude' skins can be swapped in, and some variants can be used with exiting saves. There is also a 'switch positions' function to rotate between various sexual positions, as well as a button for different camera angles. The minigame itself is based entirely on rhythm, pressing up and down in harmony. Unlike the mini-games in Leisure Suit Larry: Magna Cum Laude, 'Hot Coffee' was far more serious and realistic. With a simple modification, the 'coffee' turns into a full-blown sexual intercourse minigame. This was first officially made public in a news report and appeared on G4TV Episode #5093. When CJ's relationship is good enough, the girlfriend will invite him in for 'coffee.' However, diligent hackers discovered that Rockstar originally planned for CJ to get a more than 'coffee' when he went into their houses.