It's not strictly about sex, and yes, the game does check for/recognize the player defining traits at several steps.
With "player defining traits" do you mean race and class, or do you have any examples in mind where the character's sex is recognized? (I'm not doubting you, I'm genuinely curious.)
This came about at roughly the same time that they removed the acknowledgement of your sex from your character sheet as well. I'm assuming it's to do with modern social hyper-sensitivity, and a fear of possibly making someone feel not represented or upset, which is ironic, since, you know, I like having my physical sex acknowledged in game on my character sheet, along with all of my other personal details, so I was a bit upset and disappointed when they decided to remove it. It detracts from my enjoyment of the game for it not to be recognised. Go figure.
It's impossible to please everyone, but IMO not recognizing anything sex/gender-related is the most "neutral" stance since otherwise people will go "if you recognize that, why aren't you also recognizing this!!" The moment you can have "female" or "male" there will be people who demand "non-binary" and "genderfluid" and what not, giving the developers a hard time.
