Getting an erection is as normal as breathing;
It's not like you get one and you're suddenly forced to go 'Welp, it's time to have sex/jerk off'.
Granted, the guy could've maybe shown a bit more tact, rather than be all stoic about it.
Could be easily miscontrued as him not being interested in her through rejecting her advance, but this makes major assumptions about what their relationship currently is.