Let's face it; virtual reality is not a question of "if", but rather "when". Soon (meaning, in less than three decades definitely and possibly less than two) it will be here, and it will be possible for humans to do everything they ever wanted to do without any of the associated risks.
This means people will also, for example, be able to have simulated sex with a simulated child.
What will society's stance be on this when push comes to shove? Should all things virtual be permitted, since they are only virtual, or should they be forbidden since the line between reality and virtual reality will be too blurred? How will the governments of the world deal with this individually?
Should you be allowed to virtually murder your boss or teacher, knowing full well it's not real, or would that mean you are only training to become a killer in real life?
Will children who grow up with this tecnhology still be able to differentiate between fantasy and reality? Video games are already being blamed for a plethora of social issues.
And lastly, how do you think it should be, rather than how you think it will be?

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Well it depends on the society. In Christin: Censorship, America, if the moral pendulum hasn't swung far enough the other way, by then, we will probably have such laws and bullshit. If we are still as uninformed, then society will still blame virtual violence for violence, instead of other environmental factors that play a much heavier role on the development of the human psyche. Elsewhere in the world, many societies won't give a shit less. Other societies will be much more strict to the point of banning personal use of VR all together. I don't know how applicable VR is to the market, so I'm not SURE it will be around then. Then again, I guess I see a lot of capitalist venues for it.

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People will be so in love with their virtual reality and have so much fun with it that they'll stop doing anything in real life except taking breaks to eat and bathe. At first it will be an incredible burden for people to force themselves to go to work, and then soon after, society will just decide that they're no longer going to work any more and we'll try to come up with some system that would allow that, whether it be a slave class or the discovery of free energy or some clever economic system. People will so love their own lives that they will be deathly afraid to do anything in the real world, as it will be seen as so dangerous and needless risk.

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Each society will respond differently. If you look today at how they treat manga, lolicon, porn, etc. you can probably guess pretty accurately how they'll handle virtual sex. I bet VR is Japan will be really fucking freaky.

It's worth noting that while video games are blamed for plenty, they're not actually shown to cause any problems. Mostly they seem to help. Gamers also seem to be less violent in real life, probably since they have a safe outlet in the game worlds. I knew a guy like that, only his outlet was boxing. When he got to beat the crap out of people for an hour a day at the gym he was gentle and patient outside; when he didn't get his workouts he was pretty belligerent.

As for how I think it should be, I think we should rationally measure the benefits and harm of any given activity to children and non-consenting adults (informed harm to consenting adults is irrelevant), and allow or regulate as necessary. Of course, that argument hasn't gotten me very far in legalizing drugs, gambling or prostitution.

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