I wouldn't draw the line anywhere, so long as nobody is being actually hurt for the purposes of art/entertainment/stimulation (which they seldom are).
I think becoming jaded with overtly violent film has a curious effect - personally I have gone back to the mainstream at the moment, and realised there are actually some rather good films around nowadays (last seen: Crank - probably one of the most relentlessly exciting films ever made). That is not say I don't still enjoy a good exploitation flick, but the thrill of uncovering the more extreme end of the market - which sounds like your Guinea Pig experience - has been and gone. The legacy of encountering difficult underground cinema is vitally important to understanding the media as a whole, however.
And I wouldn't worry about questioning your motives for watching a fictional Japanese torture film - leave that to the campaign groups, Christians and the starched, sterile wierdos who make up the 'moral majority'. These are desperate to point the finger at anyone with a sense of dangerous adventure and curiousity, while they themselves are at home fucking their kids while preaching restraint and repression.
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