Oh we bet sexual favours on games all the time....I'll see your 30 seconds of nipple licking and raise you 2 minutes of squirming naked in your lap. That kind of thing

.
It's foreplay, it's dirty talk, it's a peak into the other person's fantasy of the moment....but it's never done for threat, and no-body minds if ALL the bets aren't all paid off.
There've been a couple of occasions when one or the other of us has promised sexual acts in exchange for other sorts of special treatment, but we both know each other well enough to understand that it's nothing we didn't want to do anyway...it's just that someone wants a little pampering at that moment, which is cool.
But I think I'd go absolutely cold towards someone who demanded sex acts in exchange for chores...it's a totally different dynamic.
Actually, one of the best parts of sexy betting is that sometimes it pushes you in a direction you wouldn't otherwise have thought of. I don't think I'd ever have had the guts to perform my first actual lap dance

. Sometimes you need that little bit of a push to give you the excuse to be daring.