So, I'm still under 30 and have a lot of experience as an arts educator, a director, and a performer. I state my age because I think it's important for me to clarify that my teenage years are not that far behind me, but I also have enough perspective as an adult to provide distance from them to give some insight.
When I was a teenager, I was a total edgelord and I was also tired of performing stuff like Disney, and I am inclined to agree that teenagers shouldn't be performing things that are babyish and void of any substance. Sex and drugs are part of teenage life, and Rent especially meant a lot to me. And I even was lucky enough to perform in Rent when I was 17. But my director made some earth-shattering revelations to our company that was clear we really weren't ready for it. I remember vividly one day when my cast members were performing "Without You", my director went: "You understand this song is about heroin withdrawl, not love, right?" and we were all like...oh. She had to walk through a LOT with us. She really did the work to make sure we understood, to the best that she could, what it was like to actually have a drug addiction and what that does to people.
My point being is that I didn't have the life experience for Rent that that show really asks of the actors involved. While I did have one friend who had a heroin addiction at that time, I hadn't experienced friends with HIV, friends who were sex workers, etc. yet. The way I would approach Rent as an actor now is so different than how I did as a teenager. I have not lived the lives those characters have, but my life experience closely mirrors it way moreso than when I was 17. And let's be honest, Rent gets performed in high schools in predominately surburban areas that tend to gloss over that Seasons Of Love is a song about a transgender woman dying of AIDS. With the rare exception, many of these teens are in the same headspace I was. They simply can't understand the depth of the material because it's so far away from their lived experience.
Additionally, where things get really challenging for me as both a director and an audience member is two factors: authors intent and the audience. In many ways, I think it is unethical for teenagers to perform simulated sex or wear provocative clothing because they're minors and I imagine that the parents who watched my performance of Rent felt similarly back in the day. Same can be said for Cabaret and literally hundreds of other shows that deal with topics like sex work. However, when we censor these things, it goes against authors intentions. Even when authors and estates give the go ahead for high schools to make school versions, one has to remember when the authors wrote works like Cabaret, Rent, Pippin (just a few "adult" shows that I can think of that are performed in high schools with regularity)...even most of the Sondheims--these works weren't meant to be performed by teenagers, and therefore, I do feel like even with permission, it feels unsuitable for high schoolers to perform them. Especially when it comes to sex work. Even Carrie gets hot and heavy between Chris and Billy, but never requires them to take their clothes off.
However, there are ways around it that feel acceptable to me. Nancy in Oliver! to me feels like an example that works, because there are so many children who are in that show, that she's never asked to be nearly nude or do a strip tease. The aspect of her and Bill Sykes' relationship is certainly mature and disturbing and it's a fine line, but ultimately, feels much less mature to me than Cabaret, Rent or even something like The Life or Tenderloin. Similarly, Sweeney Todd has a ton of violence, but not sex (save for the Johanna Reprise which I have seen a teenager perform, and it was uncomfortable--but these days even with adults I've seen that number cut). And while I could get into the dangers-of-sex-versus-violence-which-is-worse argument all day, as an audience member and as a director, I feel way, way, more safe for the underage actors on stage with a simulated violence scene than I do than with anything sexual. I think most people in the American Theatregoing scene would agree with me. Of course with Sweeney, it is a really vocally demanding score as are all the Sondheims, so I agree that any director doing it with minors should only do it with really excellent quality singers. The good news with Sweeney is if you don't have strong singers, there's a non musical version! Everybody wins!
I'm not totally sure what the answer is here as to what material is or isn't okay, but I can tell you that it's all totally subjective. I also can't totally explain this logic, but in some ways, I feel like it is easier to tackle more difficult material in non-musicals as opposed to musicals. In the instance of Sondheim, a lot of his work is not very provocative, but it is mature in tone. While I don't think high schoolers have any context to perform Company, I think for me personally I would rather see high schoolers take stabs at shows that feel a bit beyond their life experience so long as it involves very, very minimal simulated sex which is where my hangup with Rent comes in (although I guess Sorry/Grateful is a post-sex scene, but that to me feels so much tamer than say, Out Tonight in Rent). As stated before though, there is also a vocal concern--but tbh, I have never met an adult performer who permanently damaged their vocals chords performing Sweeney, Company, Merrily, WSS, Woods as a teenager. You'd have to be a really horrible music director to let that happen.
However as I was saying earlier--an audience member, when the clothes start to come off with pre-pubescent bodies, that's where I get extremely uncomfortable. I can live with simulated drug use, swearing, stage combat/violence, and kissing as an adult audience member--but simulated sex is where things start to get cringy for me. The pageant sequence in Little Miss Sunshine comes to mind. I know teenagers don'r want to think of themselves as kids like little Olive in LMS, but they are. Then again, I think the entire point of a show like Spring Awakening is that because we have such a puritanical view of sex with teenagers cross-culturally in Angelo-Christian societies is why we end up with teen pregnancy, rape, etc. However, even the original Spring Awakening had very few cast members that were underage, IIRC. Most of them were at least 18.