The simpler and more convincing explanation is that lawmakers write bad laws, regulators write bad regulations, and everyone votes on hot button issues like the economy, immigration, and trans athletes in sports. School lunch policy details don't get enough attention.
Everyone votes emotionally on issues they don't even understand (e.g, there is ~1 trans athlete out of 10,000 NCAA athletes right now, so why the hell is it even a minor issue, let alone a national debate?).
https://www.newsweek.com/trans-sport-pool-women-harriet-hayn...
If you truly believe transwomen are women, then its great. For anyone who doesn't share that arbitrary idea, it looks like women's sports is basically over, at least at the high end. Might as well get back in the kitchen, huh? Even women's sports is a man's game now.
That said, the ideal outcome would be apologies to every female athlete affected by this, and for these men to be retrospectively disqualified and stripped of any medals or titles, with these instead being awarded to the women who would have won had these men not been competing. I doubt this will happen any time soon, but if those running these competitions had an ounce of integrity and sense of fair play, they would do.
These governing bodies need to Do Better. They need to work on themselves.
Sports are a big part of American culture and smugly ruining them with nonsense makes Americans mad. This is not difficult to understand.
Should we ban sex for athletes? At a high school level?
Men and women are not the same. They are a distinct, binary grouping. One cannot measure up to the metrics, characteristics, etc of the other. Women have their own sports leagues because of this. Men do not have exclusive leagues, its illegal in most western countries anyway under discrimination laws. Women just cant compete at these levels though. Thats not a moral judgement but a plain reading of the facts.
As far as the incoming remark about "controlling what high school students do in private with each other", I will rather present you with a question:
Should we make it impossible for thousands of girls to get a gold medal, XOR allow 1 person, born a male and currently pretending/presenting as a woman, to dominate the competition? This is the actual, real life decision that leagues of all kinds must make, from football to chess.