As to the first of the two reactions: hooray. Your responses tell me that we are still a bit removed from the type of world Atwood is imagining in this novel. As to the third response, you are absolutely correct. It is clear that Atwood is deliberately trying to show us a world that has gone off the rails.
Science has divorced itself from ethics, the social system no longer even pretends to be egalitarian and democratic government appears to have been abandoned; and all morality seems to have been abandoned. In the world Atwood imagines, all these things are commonplace and "normal": child pornography, human trafficking, prostitution of every variety, public executions.
Snowman/Jimmy and Crake are desensitized to all of it and are also completely incapable of having what we would call a normal relationship with anyone. Jimmy is a womanizer and philanderer, and Crake appears to be incapable of talking to a woman until he encounters Oryx, and even in that situation he has bought her attention to one degree or another. Both of these characters seem to live in a world of existential emptiness, even before Crake empties the world of humanity, and I think Atwood turns to child pornography because its the best way to illustrate this social situation.