Yes, they are somewhat common. Many classic and contemporary novels explore themes of intense passion and possession in an erotic context. For instance, some works of romantic literature often contain elements where characters are consumed by their love, which can be seen as a form of possession.
One such story could be 'Pride and Prejudice'. It has strong female characters like Elizabeth Bennet who 'possess' a sense of self - worth and intelligence in a society that often undervalued women. She takes charge of her own life decisions regarding love and family, which is a form of 'possession' of her own destiny.
Another theme could be redemption. The possessed character may have made some mistakes in the past, and the possession becomes a form of punishment or a test. Through the process of dealing with the possession, they find a way to atone for their sins and become a better person. For instance, in a story where a person is possessed by a spirit that represents their guilt, they gradually face their past and make amends.
Yes, there are significant ethical issues. Such stories objectify and sexualize a part of the human body in a way that is disrespectful to individuals. It goes against the principles of respecting human dignity and equality.
The theme of community can also be present. For instance, in the school yearbook story, the possession is important for the whole school community. It binds the past and present members of the community together, and everyone can have a sense of belonging when they look at or talk about this possession.