Dear sifujeff,
There are no laws in the US that specifically prohibit private arrangements. Witness Melissa Etheridge and Julie Cypher. The father of their child is David Crosby of Crosby, Stills and Nash. Regardless of what one might think of him or his lifestyle, one would only hope that he at least has declared his intent to come forward as the biological father, should the child desire to know the truth.
As to prostitution, selling sperm or having sex with someone to make her pregnant cannot be legally defined as prostitution per se. The intent is not to sell sex, the intent is pregnancy. And no, IVF clinics are anything but hotbeds of debaucherie...unless you are talking financial debaucherie, because the owners of said clinics make indecent amounts of money.
I have had both professional and personal experiences with couples trying desperately to get pregnant, some with good results, others with disastrous moral implications. We have to keep in mind that none of these things are IN THE INTEREST OF THE CHILD, which should be paramount, from a moral perspective.
I can also tell you, that for the right price, it is perfectly legal to go to California Cryobank, pick out a donor out of a catalogue, then head to California Fertility Partners [Dr. Marrs, huge celeb in IVF circles] and pick out a "genetically superior" egg donor. You can then mix the sperm and the egg, take said embryo and implant it in a woman who has paid handsomely for all this, and who is under ABSOLUTELY NO LEGAL OBLIGATION to disclose to her child that s/he is not genetically related to her.
I personally consider this immoral and extremely selfish. Taking into account disorders and syndromes with genetic significance, it is every person's right to know his/her origin. This is even stipulated in the UN Hague Convention. In Scandinavia, there is now a law stating that parents have the duty to tell their child, before s/he is 18, if s/he was conceived using donor eggs and/or donor sperm.
So while your scheme is mildly amusing for some to consider, the emotional and legal implications thereof are clearly significant. I'm afraid I can't see the levity in it, only because I have had clients who have been near suicide, much because of these complicated arrangements. This includes the offspring of donors who are seriously depressed because they can't find their genetic parent. And, it includes a father who is deeply enraged because his wife, who carried a purchased embryo, ran away from the US, divorced him in absentia, gave birth to the baby and put someone else's name as the father on the birth certificate. And no, it's not Larry Birkhead we're talking about. These things happen because at least in the US, infertility clinics are treading in a lawless morass, to the benefit of none other than those who own them.
Blood is thicker than water,
the Love Goddess