This request on the part of the students is entirely natural and normal.  I support them entirely.  There is already such challenge and difficulty in their lives around their gender issues, I am sure, that not one of them would want to be making school more for themselves, such as acting lasciviously (or in any other way that a few frightened parents fantasize fears of).  It just doesn't happen.  I am speaking from experience of having taught trans-gendering students, gay students, lesbian students, straight students, two-spirited students ... the entire wonderful fruit salad of kids that parents send to me each day.   The kids simply want to be respected, and be able to act respectfully towards themselves and others.  Let them develop and grow into the wonderful young tax-paying adults they are aiming towards.