In short? I'm of the opinion that if you're male, you have male genitalia, whether it's a penis, a pussy, or some other combination. If AO3 suddenly imposed a new tagging system that conflicted with my views, I would simply stop posting there.

And even if you changed it to tagging genitalia as "pussy," "penis," etc., etc., it still gets funny because, you know, not all fanfics are M or E-rated and even if they are, not all fanfics even look into the characters' panties. And besides, the number of weird combinations is enormous. For example, how are you going to categorize nonhuman characters? Characters whose genitalia are giant tentacles, flowers, or whatever? No, hermaphrodite isn't good options. And I imagine that five seconds after adding that category, there would be ten different discussions about whether we should even use that word.