You’re generalizing too much from a ‘Western’ point of view. In fact, maybe even too much from an ‘American’ point of view.
Over time various cultures (some cultures, anyway) have developed taboos about various things, including sex and nudity, excretory functions, bathing, even viewing laundry that isn’t even being worn at the time (some people really have a ‘thing’ for viewing or not viewing others’ undergarments). Given the tendency to develop these taboos and the resources to accommodate them, including indoor plumbing (and the infrastructure to handle the waste outside the dwelling) and construction costs for additional rooms for various functions, we grow into these tastes.
But that’s all they are, really, just “tastes” and customs.
I’m reminded of one of the opening scenes from All Quiet on the Western Front (worth reading in its own right) where at the start of the book three soldiers who don’t know each other are sharing an open-air latrine with their backs to each other, each pretending that the others don’t even exist. By the end of the book, they are all socializing with—and facing—each other.