(Edit: I see that the discussion has moved into the same issues while I was writing this short comment that became this tome)

Gender/sex issues have been around for a long time in sports. There have always been people excluded from competing in their sex/gender.

The reported cases are predominantly of "males" competing as "female" because of the physical advantages that are possible in most sports. Here's an example from the 1930s https://en.wikipedia.org/wiki/Dora_Ratjen

Most other types of sex/gender ambiguity are disadvantageous to competitive athletes or create social barriers that people find difficult to accept or overcome.

I think that we will find that equality arguments will be considered relatively meaningless and will not determine the outcome of this debate. Competition is based upon relative advantage which is almost the antithesis of equality. Sport has always been unfair because it caters to natural advantage. The equality pursued has been through rules against artificial advantage (e.g. against anabolic steroid use) and the extremes of natural advantage (e.g. "unnatural" levels of testosterone). But other artifical advantages have not been ruled against: the best trainers, best training location and facilities, best nutrition, the ability to train full-time, sponsorship, etc.

Inclusivity arguments are far more likely to win because this is the dominant political movement. The desire to include everyone who wants to compete will, almost by definition, compromise the advantage of those in the traditional categories. In many cases inclusivity will clearly disadvantage them. But this will not be seen as sufficient reason to halt this trend because this debate is not primarily about the sport or the competition.

The political trend will win this one as the context for Olympic and international sports has always been highly political. There is lots of evidence for this such as preference for European sports, political grandstanding by nations (e.g. Nazi Germany), national boycotts (e.g. of the Soviet Union), competitor demonstrations (e.g. support for black civil rights), and national programmes to enhance player performance (e.g. East Germany), and so on.

The primary reason for resisting this change is that it is changing one of the traditional pillars of these competitions. As many have pointed out, more open inclusivity will make it advantageous for some men to become women. Athletes are generally keen to gain whatever advantage they can so I'm sure that some will take this path.

This mean that there will be a new era in sporting records. I think that transition has already happened with the acceptance of artificial enhancements like blades for running. I'm already disenchanted by the result of that debate so that I don't have any interest in the results of the current debate as I no longer watch Olympic-style sports.

I doubt that blades will ever be accepted in rugby but gender transitions would become a big issue in women's rugby.