Please correct me if I’m wrong, but I believe even if one goes through transition fully and hormone therapy, you don’t lose your body frame or muscle mass (with the exception that if you stop training, then muscle mass may decrease). I’ve read up on bodybuilding a bit and testosterone is used heavily to increase mass, but once you stop using it in excess it doesn’t mean you lose the muscle just that you stop building it as fast.
Genetically speaking if an athlete transitioned from M to F she would still be retain her abilities that she had before. This becomes an issue when you start talking about winning competitive events. It was said earlier that NBA pros are 3 standard deviations above mean height besides the fact that they have exceptional body control and “game intelligence” (unless you’re JR Smith who might be lacking game intelligence). The best female athletes would arguably be just as good as the best male athletes relative to normal athletes in their respective gender. Since both the best male and female athletes are the best in the world you may question if the females could compete with the males.
There have been cases where this has happened. Anika Sorensen and Michelle Wie both competed on the PGA Tour (which is generally only comprised of males opposed to the LPGA). Neither of them made the cut to continue playing the tournament.
Another case I know of is a male tennis player ranked 200+ in the world was challenged to a match against Serena Williams. It was informal so maybe not the best example but he played a round of golf before the match and was still able to beat Serena 6-1 in one match. Immediately after that match he also played Venus and beat her 6-2. There are other examples if you compare the times of track runners who do nothing but train and the women are significantly slower than the men, (not for a lack of effort).
Essentially there are genetic differences between XX humans and XY humans that separate them in sporting ability. When one transitions from M to F it doesn’t remove her inherent advantage at sports although it may slightly lessen it. I believe sports should not label them Male or Female but rather XX and XY to focus on the genetic differences.