1. When is that going to happen? (Genuinely curious if it does happen)

2. It is really up to the person.

That's part of the reason that "biological male" isn't a highly informative/technically-precise term, but assuming you mean something like Swyer syndrome, there isn't really a reason to worry about estrogen making them infertile, so in context using the phrase "transgender women" would have been clear regardless.

This is a bit off-topic, but "at birth" is a seriously wrong phrasing - they were assigned that phenotypical gender well before birth.

They would continue to be male, forever. "Female" is a sex, not merely a gender identity.

At birth, nobody is "assigning" genders to you, they are attempting to observe your sex from primary sex characteristics. If they see vulva, they are observing a female; if they see penis/scrotum, they are observing a male.

While there are edge cases, it is generally pretty simple.

I think, since the assignment is typically done by a medical professional (at least for recording a birth certificate), the assumption is that the gender is either a quickly fixed clerical error or reflective of a phenotype that presents as sufficiently male/female to convince a professional.

"Convincing a professional" is a reasonable proxy for biological sex, given that the cases that would fool a medical professional are in many (most?) cases sufficiently ambiguous that a reasonable person could take either side for what the biological sex is.