There's a difference between physical sex and gender. The whole crux of being transgender is that your physical assigned-at-birth sex does not match your internal gender. By any understanding of trans, Krem is male. If you disagree or won't accept that, that's entirely your choice - but expect people to get upset, hurt and offended.
Not having a sense of gender is an admirable view. However, for most of us, gender DOES exist, no matter how non binary we wish to see it as. As for trans people confusing you, well all I can suggest is to try talking to them more. I personally don't see how it's in any way confusing, but that's just me.
There's no tone options here unfortunately, so just to say FTR I don't necessarily think you're a bad/ignorant person based on the posts you've made here, and I'm not being in any way confrontational. I don't know how much you've looked into it/spoken to trans folk, but I always recommend it. Talking to instead of about a minority is usually more fruitful. 
But, and this is a serious question, what is it about being a woman or a man that a transgendered feels uncomfortable with?
Is it that they are not comfortable with societal and cultural norms established for that gender or do they feel like they identify with a societal or cultural norm that applies to the opposite gender and that is why they feel as they feel?
To be frank, and I mean no offense but I'd rather get to the heart of the matter, are people transgendered or transexual because they reject what society and culture says they are or is there something else to it? Does a transgendered female (and by that a woman who identifies herself as a man) fit in with men everywhere internally, or are there facets of manhood they identify with and other parts they reject?
For example, I happen to know a transgendered person in real life. Not best friends but we get along and talk with one another just fine. I'll refer to her as her because that's her physical gender.
She identifies with men because she is atheltic, loves sports, and has no problem joining learning martial arts and can dish out punishment better than she can take it. I asked her if she would identify with the guys who join a chess club or gather together to play Magic the Gathering and spend their money on booster packs and she quite frankly said no she doesn't identify with those guys and instead identified with the guys who played sports.
This confused the heck out of me because the guys playing chess and Magic are no less men than the guys who play sports. It had everything to do with personal interests and what societal stereotypes said is masculine and feminine and nothing to do with the personal interests of the people playing that particular game.
Yes, women can be just as competitive as men, stronger and more athletic, and men can also care a great deal on their appearances and feel more comfortable talking about things with women than hanging out with other guys, but are they, really and truly, any less a woman or a man because they behave in a way they feel is contrary to how a woman or a man should act by their cultural rules?
Again, no offense is meant, but I simply do not get it. But if someone identifies with being transgendered, gay, lesbian or whatever, that is still really only a small part of who they are as people. Krem is a great warrior. So is Cassandra and Aveline. What makes Krem more or less man/woman than either of these two powerful women?