Banda was withdrawn by FAZ from WAFCON because CAF had started testing athletes in the female category for male-typical levels of testosterone. Barring serious illness or doping, a failed test implies presence of testes which implies male.
Some male athletes who want to compete in the female category have suppressed their testosterone, either through pharmaceutical means or surgical excision of their testes. This doesn't mean they aren't male, nor does it remove the physical advantages conferred during male sex development. Which is, fundamentally, what the female category in sport exists to exclude.
So there is no contradiction as it all leads back to this principle.
Women with minor hormone irregularities, like PCOS for example, aren't affected by the above.