R23 It absolutely does still make sense to me, too. In the 1980s and 1990s, with "Torch Song Trilogy" and "Priscilla" and "To Wong Foo," and "Birdcage" and RuPaul and Chichi Larue, "female impersonator" was replaced by "drag queen" and the practice of dressing like a woman for laughs fell out of favor with straight comics/performers.
During that period, I also learned more about transexuals. Again, a whole range of people across the socioeconomic spectrum. Some were sex workers, some performed, and some were sex workers who also performed (like in "Paris is Burning" or International Chrysis, if anyone still remembers her). Some of them had hormone therapy, some had "top surgery." But the majority could not afford "bottom" surgery, or even go through the process of getting a true diagnosis.
Then, there were people who I would consider upper middle class or wealthy and had access to liberal parents with money. I knew someone in college in NYC who fully transitioned from male to female between freshman year and senior year. It had been a process since she was 14. Long and thought out with lots of milestones and shrinks and other doctors.
When I read the book of "Silence of the Lambs," long before the film was released. there was quite a bit of information about how Buffalo Bill had been rejected by Johns Hopkins and the Mayo Clinic for gender reassignment surgery because the shrinks were not convinced he had true gender dysphoria. That is when he latched onto his "vest with tits" approach. But of course he was a serial killer and a psychopath and it was a work of fiction.
I think the process mostly moves too fast today. It is important that it is understood by the public: gender dysphoria is real and it must be a terrible feeling for the person. And it is important that there is a range of treatments. But I also think this is one of the most "case-by case" conditions in all of medicine, meaning there is no cookie cutter approach—and never should be. I have read enough to understood the medical benefits of reassignment before puberty for some very rare cases. But children are very young and emotional and don't think clearly. I feel there has been a rush to normalize treatment for gender dysphoria when much more time should have been given to helping the public understand it. The reality is, it is a complex condition and sometimes people just have complex conditions and there isn't an easy solution and people have to live with the cards they have been dealt. We live in a society where people don't like being told "no." Meanwhile, telling people who don't understand the difference between "sexual orientation" and "gender identity" that they are ignorant and just have to listen to the smart people in the room is not going to help and has not not helped.
Meanwhile, "transvestite" was always so commonly misused...even going back to Rocky Horror. Sweet or not, was Frank N. Furter technically a transvestite? My own parents, who were educated and sophisticated, would frequently refer to someone like RuPaul as a "transvestite." I think this sums it up well: "Transvestic disorder is a specific paraphilic disorder in which the individual is sexually aroused by the act of cross-dressing as the opposite gender, and yet finds the act of dressing and the resulting arousal distressing." So, in a way, it's a sexual fetish that causes deep shame. I've never seen the numbers, but I would imagine most of those with transvestic disorder are heterosexual men.