He may feel unloved and unwanted by his mother. Many mothers have problems with boys because they "don't know what to do with them" Boy energy is often so different from girl energy and it makes relating to each other potentially difficult.
You could give your father a precious gift by helping him understand this. It may not be that she did not love him but more that she loved him but did not know how to relate to him and it was from this place where he felt "unloved"
I completely understand why many mothers would want a daughter. This is not to take away from sons who many mothers love even more than they do their daughters. It comes down to the woman that becomes a mother and has little to do with the child as a failing or inadequacy on their part.
Look at all the conflict between men and women. Much of this conflict comes out of the inherent differences between men and women. These same differences are of course going to affect mother/son relations yet interestingly enough often the most highly conflicted relationships are between mother and daughter.
Talking about crossdressing may confuse him but talking about your genuine feelings for him and allowing yourself to be emotionally vulnerable may help make up for what he missed out in childhood.
It is very important to recognize that parents are human and being human they are far from perfect. Help your Dad see this about his mother so he does not make it all about him and so than is able to humanize her. Sometimes we expect to much from parents and forget they have their own problems and weaknesses.
I work with the elderly and I have noticed how unresolved issues from the past seem to often come back and haunt them as they near the end of life.