The only way to have sex in Strive is either in the mansion (for the full sex system), post-combat with the generated scene, or in specific scenes/events. There isn't a way to have sex in the street in towns.
Keeping them undressed is fairly simple. The tooltip when hovering over the "Strip Immediately" option should explain, but it is only a temporary "Strip Now" option. The standard "Always Remain Nude" rule is still accessible from giving an NPC the Advanced Brand and it'll show up under Customize. The other option is just an easy way of stripping them down while talking to them but I was trying not to override the base game's intention on that.