Pretty effed up. AI Dungeon (which was itself an amazing storyteller if you work with it properly) imploded at some point because it implemented content filters in response to users creating effed up stories. This led to false positives and privacy concerns; the process could include human moderation and I guess lots of people were using it for more mainstream pornographic stories.
ETA: I haven’t looked at the space in a long time, but I glanced at the Steam version of AI Dungeon just now and the very first review mentions a couple other services that are more ‘friendly’ in terms of filtering and encryption. I assume they, like the most recent AI Dungeon build, are based on GPT 3.