Why Do Japanese Games Handle Trans Characters so Differently?

If you play a lot of Japanese games, or consume Japanese media, you might notice that there is quite an abundance of gender non-conforming, crossdressing, and trans characters... but not very many gay or lesbian characters, by comparison.

In the West, T acceptance has been much slower than LGB acceptance, but in the East, this trend is largely the opposite. Why is that? And what does this have to do with video games? In this Pride Month special, we'll be looking at the history and development of characters like Birdo and Bridget to see what we can learn about cultural differences in the area of gender studies.