The "problem" probably lies more in the type of porn people watch, than the fact that they watch porn at all. Exposing the former might be very embarrassing while the latter as you say - wouldn't.
Yeah, I mean...you typically assume that any guy (and many gals) you're friends with or work with watches porn at least sometimes. And in your head it's just "porn" without much thought given to it. For better or worse, a person's sexual fantasies and proclivities are considered very personal and private. Knowing that the fella in the next office over doesn't just watch "porn" but rather that he watches a lot of scat porn or porn with specific focus on power play between (for example) people of different races or ages or is into any number of other fantasies...it might cause many people to get skeeved out. Even if you're fairly open minded and don't care that people you know could be watching any number of porn sub-types, there's something uncomfortable about knowing the specifics. It's like seeing someone defecating. Everyone does it but for whatever sociological reason, it's not something you want others to see (usually (see porn discussion)) or something you personally want to watch.
I think on some level, the situation of "modern man" is one where we cultivate the image of our higher functions and logic while hiding the more primitive, animal sides. For many people, sexual activity and elimination are just too "gross" and primal for comfortable observation. Of course that transgression is the fuel for several fetishes but that's only tangentially related.
The other thing to consider is that fantasies are often a way to address those primitive motivations and desires in a way that doesn't interfere with the operation of modern society. Maybe a woman likes the fantasy of a dominant or forceful partner even if actual coercion or rape would be horrifying. Maybe a man likes to fantasize about sex with a room full of women or people who look like his boss. In reality he's not going to attend orgies or pursue his employer but the fantasy is a way of exorcising and addressing what his lizard brain keeps pestering him about.
When others learn of these fantasies and interests, how do you know they aren't going to draw the wrong conclusion? Your coworker probably isn't a rapist or a rape victim or planning to pursue their boss or someone who goes cruising for anonymous sex with lots of partners but when their porn history is exposed, how do their coworkers not recoil from them or judge them harshly for those thoughts?
I guess in a perfect world we would all just accept sex fantasies as what they are but in reality, the line between public and private life is one that seeks to minimize the conflict that would arise if we really knew everything about other people.