They don't, so I'm confused what the purpose of this feature would be. You character does have a gender, and that gender does affect how characters react to do, so maybe that's what players are looking for? But gender doesn't otherwise affect how you look like in any way.
Do the characters even refer to you outside of the name you enter? I’ve only played up to maybe half of the game and don’t remember much
They don't, so I'm confused what the purpose of this feature would be. You character does have a gender, and that gender does affect how characters react to do, so maybe that's what players are looking for? But gender doesn't otherwise affect how you look like in any way.
Yes, they do. Alex calls you a guy in one of his lines for example. There's a whole mod for gender neutral language.