That picture is horrendous.
There was another picture around of Charlize Theron's adopted boy wearing a pink dress or something.
A child doesn't know what the fuck he/she wants, or is. And paretns shouldn't be backing a child's wants because there is no way to tell if it is truly how they feel, or if it's a phase. Encouraging them to act out can normalize behavior that may not be actually what they feel.
If you really want the kid to be able to grow into whatever they want, then dress them neutral. Don't dress up boys in dresses and halter tops and skirts. Put them in some gender neutral clothing and colors. As they grow up and mature they can decide what it is they are