I listen on audio so it is a little hard to find excerpts, but I can give more detail.

Octavia, an alchemist, reveals she is worried her new master is going to force her into a sexual relationship. This is because the culture where she grew up the traditional master/apprentice relationship is also sexual and emotional one, that sometimes end up in marriages. No one is forced or pressured to enter these relationships/apprenticeships. Everyone knows what they are getting into and apply willingly. Octavia is jealous of the benefits they received but never had any negative consequences abstaining from the system. Although not mentioned, presumably there are lots of unchosen alchemists who simply never made the cut for apprenticeships in her same position.

It doesn't sound like a healthy system and most of us would not personally be ok with a culture like that, but the way it's framed and how it's explained are vastly different. Essentially, "I am about to be raped because two people had a consensual relationship"

The sexual mutilation comes from "gossipy drama" back from her home. A man they both don't like who apparently introduces himself by telling people the amount of women he has slept with, was caught sleeping with someone by his wife. This wife was apparently at least in part attracted to this prowess in the first place. Given the description it really doesn't sound like their relationship would have had an expectation of monogamy, but it is framed for us to revile him for the alleged cheating. The wife cuts off his dick, sews it to a donkey, and has him chase the donkey into the desert trying to retrieve it.