I would say that it would really depend on the context of overall economic reform. If decriminalization of sex work and destigmatization of sexual media is linked with broader redistribution of wealth and income and people of less economic privilege were given more opportunities in traditional jobs with more livable wages and more generous benefits, then I guess that there would be some diminuition of profit because it would lose a lot of its stigma and "naughtiness", and thus its lure as a "guilty pleasure". On the other hand, since supply always tends to follow demand, and the more economically secure a person would be, the more that (s)he would be able to seek sexual services without fear, I'd guess that the increase in demand would make up for the temporary loss in profit pretty soon...so I'm guessing that it would turn out to be a wash in the long run.
On the other hand....if decriminalization took place within a more conservative, "libertarian" environment with no subsequent overall economic egalitarian movement to level the playing field, then I guess that we would just see more of the status quo, with the typical class stratification between the wealthy sex workers living off the services of the rich; the middle-class sex entertainer hanging on off the fruits of the Internet or the local strip club or playing on the side; and the working poor still struggling to survive....yet with a bit more protection and security than if criminalized due to the regime of labor and worker protectuions that would be assumed under a more progressive regime. The possibility of continued economic exploitation of the third group would still exist enough to engender calls for negative reform by the "antiporn Left" against such "elitist libertarianism", especially given the possible race and gender stratification; but at least there would be some buffer of protection existing for those at the bottom in a more "sex=positive" regime. Not enough, in my view, but some.
I would say that a combination of unions and worker organization for the bottom combined with some form of guild organization for the middle would be more suitable for worker activism; the latter idea would be especially helpful for those "independent providers" that Blanche talked about....those who would not be particularly helped by traditional unions. But, any type of reforn or decriminalization that does not take place within the context of a broader progressive program of economic redistribution of wealth and power, and a more direct and forward theory of sex positivity, will ultimately fall back into the same old paradigm of "libertarian" ve. "liberal puritan" vs. fundamentalist standoff that has maintained the status quo for so long.
Anthony