I think covering up is overrated. As a society we have become extremely self conscious - to the point of death (teenagers and adults being bulimic and anorexic over needing to look a certain way). If we were to grow up in an environment of being comfortable no matter how we are dressed (or not dressed) this obsession with looks wouldn't be as big of a deal as it is now.
My son is 7, my daughter is almost 5. My husband and I both go naked and the kids get to learn about body parts without embarrassment. And, my kids feel they can be naked without judgment as well. They still don't know what judgment means at this age which I am sooooo grateful for!
So strip it off! And the XXX sites won't even be an issue when they get older! (Don't quote me on that - just havin some fun!)
But if you or your husband is uncomfortable being nude around your children, may I just suggest that you don't make a big deal about covering up, otherwise your children WILL think it's a big deal. Everyone's body is so beautiful in it's own way, it's our temple, be proud of it!