Huggett, 55, -- who is facing charges of sexual assault with a weapon, harassment, extortion and possession of child pornography -- was granted bail, but with strict conditions.
Those include that he not be in contact with anyone under age 16, that he stay away from schools, parks and community halls where anyone under 16 might be, that he stay at least 300m away from the alleged victim and her home and abstain from drugs and alcohol.
In opposing Huggett's release, Crown attorney Jenny Rees outlined disturbing allegations made by the woman, who can't be identified.
"He would also be looking at pictures of children while having sex with the victim," Rees told the court.
Rees said the woman became involved in a sexual relationship with Huggett after he allegedly offered to help her financially.
It's alleged Huggett would ask her to wear photos of children's faces over her own when having sex, that he once put a handgun in her mouth and forced her to lick it during intercourse and he sometimes called her by the names of her friends' and family's children.
None of the allegations have been proven in court.
The woman also alleged she saw Huggett viewing child pornography on his computer, which was seized by police.
Rees told court a forensic examination of Huggett's computer and electronic devices is not yet complete but investigators have so far not found anything incriminating.
Wearing blue overalls and a full beard, Huggett winked and smirked at members of the media when he was brought into the courtroom by sheriffs.
He stared straight ahead from the prisoner's box through most of the proceedings and didn't exhibit any emotion.
Outside court, defence lawyer Gloria Froese said she was happy Huggett was released.
"He's charged with an offence where they have no evidence yet," she said.
"When their entire case stems from one complainant ... the court is going to have some concerns with respect to that I would think."
Huggett was sentenced to nine months in jail in August 2009 for possession of child pornography.
He is scheduled to appear in court next Feb. 20.