Is there still good and bad?

Huh, again take this with a grain of salt because it’s been so long since I read it, but my reading was not that there is a “real” thing called purity (whatever that means) but that human beings will tend to construct something called “purity” or “sanctity” that is important to us, and that this is a part of psychology that we can’t discount even if rationally there’s no reason for it. Basically, I agree very much with your #2 and I think Haidt would too, but I think he would say that people DO tend to make “sanctity” constructs out of societally preconceived notions and so therefore this is going to be a societal thing that governs people’s reactions whether it makes rational sense or not.

(I also agree with your #1, but I would also agree with Haidt that it’s not generally speaking the underlying reason why a person might react with visceral disgust to the idea. For someone like me, I might react with visceral disgust, then think through that and decide okay, maybe my societal preconceptions aren’t a good reason after all, and then think of #1 as a reason why it makes sense to object to it.)