I appreciate you asking in good faith because too many people have tried to reinforce the "non-binary people can't be dysphoric" myth in bad faith. As a matter of fact, that may be a reason for your confusion. Honestly speaking, there is nothing, in any sense, contradictory with saying "a person who identifies with a gender that isn't exclusively male or female can experience distress over sex characteristics", but a lot of vile and unhelpful discourse has reinforced the notion that such a statement is contradictory, and it's time to undo that.

I'll start off with my own individualized point of view: I myself am a non-binary person who experiences gender dysphoria. I am transfeminine, a term I use to state that I was assigned male at birth but am transitioning in a feminine direction (note: some people use different definitions for that word). For me personally (big emphasis, we're all different), I feel dysphoria over having an excess of male sex characteristics. However, a caveat for me is that having many female sex characteristics would induce gender dysphoria in me as well. I don't fit into a typical binary trans woman's notions of "passing as cis" at all because I'm not really one who could be content with characteristics that could make me come off of cis. I fit into a realm where I'm not within society's typical perception of a man, but I am not in society's typical perception of a woman either.

Socially speaking, I wear longer hairstyles but ones that are usually perceived as unisex (for me as a black person, I rock dreadlocks for instance), I wear some makeup, but nothing that comes off as too prominent, and I wear clothes that aren't explicitly feminine but could be perceived as more womanly (I wouldn't often be caught wearing a dress or a skirt, but I do wear button shirts and sweaters that are "meant" [all clothing is technically unisex lol] for women rather than men quite often). A lot of people would say that this puts me in a field of androgyny, but I seldom use that term myself even though it's practical in conveying this. The reason why I don't use the term myself is honestly just vibes. I don't like to say I'm striving for "androgyny" as much as I like to say that I'm striving for a feminine form of my "male" self without womanhood while also still not identifying with manhood either.

As far as pronouns, terms, titles, and gendering go for me, I go by any and all pronouns, terms, and titles. This isn't because of a form of "yielding", in that I do it to submit to people being adamant about not wanting me to gender some other way I'd "truly" prefer to be gendered (i.e. me being like "I'd rather you call me they/them pronouns, but I guess you can call me he/him because I'm scared to be so 'demanding'."). I note this because even the doctor who prescribed my HRT, albeit in good faith, assumed that's what I meant when I told him "I go by any and all pronouns". My pronoun preferences stem from me being entirely indifferent on the matter, as being called a "he", a "she", and a "they" all feel exactly the same way to me in terms of gender affirmation. My sense of gender isn't really concerned with it.

To an extent, one could say that I don't have social dysphoria, but there's a caveat with that as well. I don't mind people calling me gendered terms like "man", "woman", "brother", and "sister" in place of more gender-neutral terminology like "person" or "sibling", as long as my experiences aren't being denied in the process. I don't mind people referring to me with male terminology as long as they aren't doing so with the intent to invalidate the ways being non-binary has impacted my life, socially and otherwise, treating me as if my essence in society is tantamount to that of your average cis man's. An example of this could be someone telling me that I don't know what it's like for patriarchy to negatively impact me harshly due to them placing me in role of a cis man when saying something like this which, unfortunately, I have been told my some more insufferable types of feminists.

Medically speaking, I'm on estrogen and anti-androgens, at the typical dose many binary trans women would take, which brings me to a brief point about microdosing. Some non-binary people who take hormones like to opt for a reduced dose in comparison to what most binary trans people take, but some people sadly and wrongly believe that microdosing gives you fewer effects from HRT. To correct this myth, it actually just gives you the same effects of a standard dose, but at a slower rate.

Fortunately, I'm content with a standard dose because, the way I see it, HRT doesn't have the potency to make me a "cis passing woman" alone. It doesn't have the potency to do that with most trans women actually, so I'm able to go about other steps like social transition, voice training, and surgeries that let me tailor those to more goals in androgyny. With that, I've noticed that feminizing my form to the most potent and quick degree will make me achieving my transition goals easier rather than harder.

Speaking of surgeries, I desire an orchiectomy and facial feminization surgery, but that's about it for me surgically speaking. I also am aiming to remove every bit of body and facial hair I can through electrolysis.

I'll keep this section brief because that one was long, but let's talk about dysphoria for OTHER enbies: I explained my own experience with dysphoria, but to briefly touch on how other non-binary people may go through it, non-binary people often have a more varied experience with dysphoria than binary trans people do, which is funnily enough exactly what bullet point 8 was speaking on. Some non-binary people prefer to undergo a gender transition very similar to the way many binary trans people do it. Some may even desire to be passing as the opposite of their assigned sex at birth. Some may not want to transition medically at all, but they still may have non-medical means of dealing with dysphoria if they are to have dysphoria.

Some non-binary people are willing to go with more "experimental" procedures to reach different goals in gender-neutral presentation. For instance, I've heard of non-binary people who have undergone nullification, a surgical procedure which aims to leave a smooth groin area devoid of genitals. In fact, my gender therapist himself worked with an agender patient who has done this. Some may go for something like a phallus-preserving vaginoplasty (AMAB) or a vagina-preserving phalloplasty (AFAB) to have both a penis and a vagina in their groin area.

It's all dependent on how people personally relate to dysphoria, but those are some of the more common ways it manifests in various non-binary people I've interacted with or learned about.