Eww, gross, you modified link()? How could you enjoy abusing a filesystem like that?
Cueball seems to have found a porn folder. However, it contains a directory loop, set up by a person off-screen. It is possible to actually do this, but it is widely regarded as a very bad idea, as it can break the system in not-so-obvious ways (mostly by causing seemingly-trivial operations to infinite loop). The implication is that the folder does not need to contain pornographic images because the folder is the porn—its violation of the taboo against looping is something the off-screen character finds erotic.
link()is the Linux system call to create a hard link. In an unmodified Linux kernel, it will not allow directory hard links for this exact reason; the person who set up the porn folder apparently "forced" Linux to comply, with all of the sexual analogies that suggests.