The pendulum swings. Look at historical photos of sailors from WWII and previous conflicts - just google "WWII sailors with tattoos." Some serious ink! Mermaids and anchors everywhere. Of course, it would be interesting to know what the regs were at the time, and with a full mobilization war on, if standards were looser. Officer ranks typically did not get them. That is a change, and reflects the spread of tattoos through younger generations in all socio-economic backgrounds.
For recruitment and retention purposes, I think the policy represents an acceptance of a new norm. Not my thing, but as boomers depart the senior ranks and younger generations rise, I suspect we will see many changes.