Is it a hobby? I suppose this depends on a person's definition of "hobby", based on the degree to which they need to engage in it and also the strength of their reactions when they do engage in it. As Eryn pointed out, some people turn their hobbies into obsessions.
I was an avid skier when I was younger and you could say this was a hobby. But, during the times of year when there was no snow, I did not get the urge to ski nor did I even think about it. It was not something that I had to do nor was I miserable without it. Eventually I moved out of a skiing area. I just spent my time doing other things . Also as much as I did enjoy skiing when I got the chance to, the pleasure that I derived from it came nowhere near the level of euphoria that I often see described here, especially when a CDer crosses new barriers.
The CDing alters the expression of a person's gender. And gender is a fundamental building block of who we are. It just seems to me that anyone engaging in something like this is doing so for deeper reasons than just playing around with a hobby. Also, I can think of no hobby that necessitates lying, non-disclosure, and/or hiding and that can possibly put relationships or a job at risk.
I would consider two instances where the CDing conforms to my definition of a hobby:
A man who occasionally does drag shows for fun (not professionally ... else it would be a job) and who is not interested in dressing the rest of the time.
The scores of CDers who dress strictly for sexual gratification in mostly clothes that cannot be worn in public, and who participate in all the sites that Google comes up with when you enter "CDer" as a search term. But, this type of CDing might be considered a hobby in the same way that watching online porn regularly is a hobby. :p