Debate with HBS people

If you're interested in this sort of thing, I'm currently involved in a debate with some "HBS" trans-folk over on Transadvocate. It was regarding an issue discussed over on bilerico. I'm having a good time on both and am really hammering out some of what I believe with regards to this stuff. It's a very interesting discussion.

How should a society handle those individuals that do not fit its definitions of "men" and "women?"

Should it...
Expand those definitions to include more people?
Ignore the issue and let such people figure it out on their own?
Offer them explicit protections against discrimination?

The issue has been largely ignored in America for a long time, it seems. Currently, trans people are pushing to get it recognized as a real issue. But how do we avoid unintended consequences of this recognition? How does this apply to things like monogender schools, binary gendered bathrooms, showers, and locker rooms, and more?

The question is serious, but very interesting.

I'd love to read your thoughts on it. :)