Just my 2 cents here, but if I hadn't finally stopped giving a d*mn about whether or not I 'passed', then I would have never mustered the courage to go out into Mainstream society.
It was always easy for me to go to the GLBT clubs and CD/TG meetings, because I knew I'd be accepted there, but that's not how I wanted to live the rest of my life, just limiting myself to those venues. I needed and wanted to present as a woman anywhere I felt like going, and with the encouragement and support of some good friends finally came to realize that I did not care anymore if I got 'read' or not.
Once I made that mental switch it changed my whole outlook, and my day to day existence. I still have a long way to go as far as feeling I can be full time, or anything approaching the impossible standard that many call 'passable', but at least I try, and at least I'm getting my butt out the door in a dress on a regular basis now. This CD you saw is apparently doing the same thing, no longer living life according to the unrealistic standards of others, but rather going out and enjoying the world while wearing the clothes that feel right inside.
Trying to hold every CD/TG/TS to a picture perfect ideal is not only unrealistic, but unfair as well. Just look around you, how many cis people do you see that look like crap on a daily basis... go ahead and look, the answer is a majority of them are sub standard compared against the artificial ideal many are trying to hold the rest of our community to.
OK, my rant is over now, but to summarize; this person you saw should be Celebrated, and consider that perhaps you might have had a different reaction if you yourself had been dressed at the time...
