I had stopped offering vaginal for similar reasons and it is working well for me.
I cut my rates and have fewer enquiries, but i definitely keep busy enough. Of course 'busy' is very subjective, but i am happy with the amount of work. I seem to have fewer long bookings (1.5 hours +) and much more half hours. A lot of regulars carried on seeing me, but they did say that they only did because they liked me but they wouldn't take a chance on a new girl who didn't offer PIV.
It is a bit disheartening when i think of all the money i used to be able to make in a day, but after comparing my income on a weekly and monthly basis, i am actually doing just as well (if not better) financially because i don't have to keep on cancelling bookings or taking breaks. Business is a lot more sustainable since i stopped offering penetration. If penetration is causing that much grief, i would definitely recommend cutting it out.
As for telling clients? I would just be honest and say that it causes UTIs. I know it isn't the sexiest of reasons, but it is straightforward and very plausable, and as others have said, you don't need to explain.
Feel free to message me if you have any questions. Good luck!