In the UK every gymnastics coach is required to go on a safeguarding course before they can register as a coach, get insurance etc..
It involves seminars on scenarios like this- appropriateness of contact, esp. social media, allowing coaches to be alone with children, i.e giving lifts home or travelling to competitions. How and when it is OK to physically touch a child.
That's in addition to the usual scenarios where coaches might be concerned about a child's welfare or home life.
Also when, as a coach, to report other coaches or adults behaviour.
If I knew a coach having sleepovers like the o/p posted, I would be obligated to report it to our club welfare officer (who has to undertake even more detailed safeguarding training). It is not my position to make the judgement call on whether it is OK or not, my job would be to escalate it so the club can decide if it's appropriate behaviour, and how best to protect the coach and children.