You people seriously underestimate medieval humor. Almost every example we have from the era is silly childish jokes about farts, excrements, people being confused for animals etc.
Common people mocking a noble's penis size is absolutely something that would happen. There would be Farces about how his wife had sex with a donkey instead while the husband was unable to act and caught in a bag while his favourite concillor describes the scene to him.
Yes, in game they can be annoying in repetitive, but don't think that they are out of place and anachronistic memey references. Medieval people weren't Vikings/GoT people who could only laugh at the cruelty of life when their best enemy lost their head.
You are technically right, but at least in my opinion, that is somewhat beside the point. Medieval people did enjoy dirty humor and they were regular people. They also had pets, they ate breakfast and did all kinds of mundane things that had little to no impact to their dynasty and legacy.
The issue is that describing these mundane aspects of life too frequently or with little consequence when the core of the player's attention is in things of a different scale, like conquering land, converting the realm, managing succession, is easily disrupting and irrelevant to the player's goals.
Pets, toilet humor, penis size-rivalries CAN all be meaningful as catalysts in creating friendships or antagonism that are impactful. The events can work as settings or proximal causes for something that has been bubbling underneath because of conflicting personalities or interests or old grudges.
There are a couple of challenges here: If I have dozens of courtiers and dozens of vassals in a big realm, often I really don't care at all whether I have the chance to befriend or mistreat some nephew or antiquarian or a random count. When an event has a large pool of characters to choose from, it often ends up involving people that don't matter all that much. And gifts, schemes, feasts, marriages & court positions already give us enough tools to influence the opinion of people who do matter.
When relevant people are involved and the player choices are impactful, the questions of location and logic remain. I hope the location issue (court events bothering someone leading an army) will be much fixed with the T&T DLC, but the other thing remains.
By logic I mean that if I gain a rival after someone sabotages my language studies or mocks my penis, we're not *really* rivals because of what happened, but the event was a manifestation of an earlier underlying malice against me. The reasons for this malice should be more understandable, it shouldn't seem like a random pick.
A logical, location-wise plausible event exposing serious antagonisms can be a good one, even if it involves jokes about infidelity with a donkey.