No, you weren't hallucinating if you saw naked boobies on C-SPAN this evening while flipping channels (since it's unlikely you were actually sitting there watching it): uncensored, unpixelated clips from the M-rated "The Guy Game" and "Leisure Suit Larry: Magna Cum Laude" were shown to a bored looking audience (including Senators Joe Lieberman and Herb Kohl) as part of a National Institure for Media and the Family briefing on its annual MediaWise Video Game Report Card. As with most such "but what about the children?" type of reports, it's hard to tell exactly what the purpose of the video footage was: presumably, either to warn Mom to keep an eye out for certain game titles on Junior's wish list, or to help Dad decide what to buy himself for Christmas this year.
http://www.fleshbot.com/sex/straight/found/boobies-on-cspan-026289.php
http://www.wonkette.com/images/uhm_oops.jpg