I think this might be kind of silly of the parents...because the child is so young. This is probably just a pretend game, given the age. On the other hand...it might not be, if this is really something the kid is confident about. That said, either way they're just using a different parenting strategy than most people do. You and I don't know whether or not the child is transgender. You and I don't know how much of masculinity or femininity stems from how society pressures us to behave. For all you and I know, this might be good parenting...parenting that frees the child to grow the way they want to grow without society's pressure in the wrong directions.

This is not "abusive" because for all we know it could benefit the child.

It's odd...but really not that odd given how little we know about what's best for people.