Since your question has two parts, I'll address each separately. As far as how you can go about it, I would recommend that you self-publish as an e-book! You can use the web site below to get a free pdf version on how to get started. Someone made the following comment on a previous answer which has since been deleted:
A self-published erotic novel will most likely fail unless the author has the experience needed.
I would beg to differ on this opinion. I didn't have any previous experience, but I decided to self-publish a series of erotica e-books under a pen name, and I have done quite well with them. So far this month I have recorded over 7000 sales on Kindle alone. (Yes, that's one month!) There are a LOT of people who are buying erotica, and there is no time like the present to jump on the bandwagon. (One of the points I have seen concerning this is that the big advantages for readers is that nobody can see the cover of the e-book they are reading, so nobody can judge their selection of reading material.)
As far as the question of how far is too far, that would appear to be certain forms of incest and anything that mentions or includes under aged participants. Amazon in particular has been very strict about these two particular topics and has gone so far as to remove books by some authors for featuring either topic. Some forms of incest seem to be getting through (uncles are currently popular), but underaged participants is absolutely taboo.
You can try the options suggested in the other answers, but you'll spend a lot of time trying to promote yourself and trying to get someone to publish your book. I strongly recommend doing it yourself. I have done absolutely NO promotion on any of my erotica over the last three months, but it has taken off at an amazing clip. The real difference changer for me was to offer a single short story for free. People who downloaded that have gone on to buy my other titles, and I suspect many of them have bought more than one title. Over the past month I have had four different titles that have made it into the top 20 for erotica at Amazon, and the free short story made it into the top 150 of ALL free books on Amazon!
(Disclaimer: The author of this book is in a writer's group that I am part of, but I do not know him personally. I have traded messages with him from time to time, but I have no vested interest in promoting his book. Besides, it's free!)