I think you've misunderstood me. I think he was expressing concern over GENDER identification, not sexuality.
Gay men still identify as MEN, not women, just like heterosexual men. That's gender identification as men, which is separate from sexual preference. Some of that is cultural, ie, Scottish men can wear skirts and still be considered masculine, however in the US, it isn't done, so that's something that is learned as a person grows up. I think Dr. Phil's point is that the child appears to be identifying as female and he isn't old enough yet for his sexuality to be expressed, so there might be some confusion there.
At least, that's what I interpreted.
I think you're right about needing to be very careful not to shame a child about things like that, and that's where it becomes complicated, because a boy who wears dresses will most certainly be shamed by people other than the parents, so to protect him from being shamed, how to proceed? Would he be more shamed if you explained that boys can only wear dresses in secret or else he might get made fun of, then let him do it anyway? If he feels any shame, I would feel that he shouldn't be allowed to do it. The memory of doing shameful things is damaging. It's only if he could wear dresses, not feel ashamed, and not be made fun of that would be ideal. What if a parent were to let him wear dresses now, and years later he feels ashamed looking back on his own childhood, say, when he's in puberty or a teenager? Could that negatively affect him? Or would it simply be smarter to remove all dresses and only provide boy clothes, so all shameful circumstances could be avoided entirely. It is a complicated problem, and one I hope I don't have to address someday, because I know I would be constantly worried that I'm making the wrong choices. I can't judge a parent in that situation, because I don't know what the right thing to do would be. I know that most of it just depends on the child and the circumstances, and there isn't a single answer that is right for every child.