No the watershed is for a reason
http://www.bbc.co.uk/guidelines/editorialguide lines/edguide/harm/televisionthewa.shtml
This (in my opinion and also backed up by various other posters and presumably the BBC) is that this was a humorous remark which was suitable for broadcasting before the watershed.
People can take offence at pretty much any remark easily. People were even 'offended' by the way that female presenters had a poppy on their left hand side instead of the right hand side, prompting one presenter to state that this had been checked with the British Legion, and was okay.
Of course there should be a watershed, and there is always going to be a dispute as to what is appropriate, however in this case, I believe that the remark was made in humour and could be easily explained to a child.
As I said, do you think all slap stick comedy should be banned before the watershed, and all films such as Home Alone, given a 15 rating?