The root of the word "horny" is "horn" (which we already established). "Horn" suggests an erect penis cuz . . . well, ya know why.
The word "horn" is a Germanic word, descended from Indo-European. It's a cognate of the Latin "cornus". That's where the word "corn" (on yer feet) came from.
Interesting (and potentially useless) tidbit: "Horny" didn't use to have a sexual connotation. The name of a German saga (Have ya heard of it, Dreamwalker?) is "How Siegfried became horny" (which I read in German class). He didn't become sexually aroused. When he slew a dragon, the fat spilled on the ground and he bathed in it. The fat made his skin hard like a horn (horny). So if the skin on yer hands is tough and hard as if they had endured wear and tear, ya could technically say "My hands are horny". But of course, because of the sexual connotation, ya'd either confuse, disgust, get a laugh out of, or turn on whoever happens to hear ya say it.
There's my SEVEN cents. Count 'em!