I think it's more like saying "it's alright if that's what you choose to do." I don't think it would encourage them to do it. People make similar arguments against legalizing marijuana, saying that it would basically be like telling kids it's alright to smoke pot, but I really don't think that's the case. People tend to do whatever is "forbidden," thus is why prohibition not only does not work, but makes the problem worse.

Just the same, people make the argument that giving kids condoms or teaching them about sex tells them that it's alright for them to have sex. Once again, this isn't really what's happening. People are going to do these things (Get/be hookers, do drugs, have sex) regardless of whether or not these things are illegal, and making them illegal only makes the problem worse, by putting a drain on our economy, straining our jail system, and essentially making people more likely to do these things.