Well, I can't speak for everyone's deep personal feelings as to how they physically "measured up" with the guys around them back then...but by and large, most guys just didn't have an issue with it. Sculpted bodies and big biceps weren't the markers of "maleness" (gay or straight) the way they are today...nor was a huge dick. Now I can't say if this was because the whole issue was already normalized by the nudity...or if it was just because those sorts of attributes just weren't considered as important to a man's character as they are today. Back then, I just wasn't that tuned into the possible psychological ramifications because group nudity was just such a fact of life. But looking back now, that would be an interesting question to know the answer to...
However, I do think that being surrounded by nudity makes you far more aware of the basic "average-ness" of most males. And then, that changes the dynamic immensely. Yes, there were a few guys with great bodies---mostly the guys on some of the sports teams who of necessity had to work out on a regular basis. And while they occasionally received positive comments on some aspect of their build, it was more in the spirit of the guys knowing the extra effort it took to look like that for your sport (and not for your girlfriend, or for Tik-Tok) rather than being driven by any sort of envy, or feelings of "inadequacy" in oneself.
I will say, however, that also back then there wasn't the issue of American men/boys being overweight that there is today---almost all guys had the typical slimmer male body of those time periods, so body-shaming in the current sense hadn't even been thought of. And sure...some guys took more ribbing than others about other body features. I was short...and had a more-than-average amount of body hair...so I came in for my share of it myself. But I knew that it was all in fun...and I gave as good as I got.
Same with dicks. Once you see that MOST guys are just as "big" or "small" as you are, it changes the dynamic. There are really very few monsters out there (although that does seem to be changing, if LPSG is any indication). And in an open shower situation, everyone sees that all the rest of the guys have the same issues that you do with shrivel---and then semis---around warm/cold air and water. The few odd guys who really did have the big equipment were sometimes teased about it. But again, it was usually just in the spirit of guys being guys, and not out of any feeling of envy (well, maybe just a little bit
!) or inadequacy.
And because of that, the level of comfort with it was different than today. My first college dorm---back in the days of the all-male/all-female dorm---was one of the older ones at the school (which at one point had had a military background), and there was still a holdover "barracks" gestalt to much of the older designs. The single shower room/toilets for the whole floor was down at the end of the hall...and it wasn't unusual at all for guys to walk back and forth to the showers from their dorm room naked, with their towel over their shoulders and not around their waist (this was before women were allowed in the dorms). And, what with all the steam in the shower room itself, most guys shaved naked as well...and then dried themselves in the hall where it was dry and cooler. In any case, you got used to being naked pretty quickly...if only out of convenience and comfort.
And, of course, there was always a LOT of banter going on...
As to the fear of homosexuality...I don't remember any of that at all. But then, the times were different---gay men weren't "out" then, and of necessity made an effort to fit in with the larger male ethos (whether they liked it or not, I guess). They were pretty much invisible...and hence, perhaps, not a threat. And I am sure that there were gay guys on the floor---with that many guys, the averages were just there. But, as I've said earlier, the religious aspect of homophobia that we have today wasn't there (and this was a college in the Deep South, no less)...so there really was no overt fear along that particular frame from the straight males. Now, I do know...(and I know that I'm going to get slammed for saying this)...that there was a certain amount of male/male activity going on behind the scenes. It wasn't "gay" in the current sense...it was just guys (straight or gay) needing release...or maybe just "bonding". Whether that in and of itself tempered the fear of homosexuality, I couldn't say. But, it was there...and a fact of life at that time.
Moving forward, what I do find funny today (but very sad, actually) are the myriad of snarky comments I see on this site (and elsewhere) with regards to the "Old Trolls" at the gym who sit around naked talking after a workout/shower at the gym, while the younger guys complaining about it do the Towel Dance. These younger men really seem to think that these are all old gay men just sitting around waiting to ogle them as they dress---and they couldn't be further from the truth. Most of these "old" guys were just used to the nudity and banter of their younger days...and are trying to recreate it in their own way. They're still very comfortable with it...