Your first para seems utterly bizarre, to the point of nonsensicality. Maybe it would help if you could say what you think "gender" refers to, but at this point I doubt it.

Your second para's argument would only be valid if you thought that sex is defined by external characteristics. I'm pretty sure you don't think that. And as far as I'm aware, while some DSDs certainly have a gene-expression component, there's no reason to think that they don't all ultimately have a genetic basis. There's a strong whiff here of "it's all terribly complicated so let's just agree that nothing means anything".

Obviously people can disagree about the merits or otherwise of a genetic classification. But it's not straightforwardly wrong or insane, particularly since credible alternatives have been notably lacking.