The way gender is handled in fairy tales is very binary. What I mean by this is that there is a heavy emphasis on gender roles as well as the “Angel vs. Monster” theory coined by Sanda Gilbert and Susan Gubar in The Madwoman in the Attic (thanks, Critical Theory!). The men in fairy tales are typically heroes or princes, who are brave, strong, and handsome. They always kill the “bad guy” and win the princess’s everlasting love.
The Angel vs. Monster theory comes into play in regards to women in fairy tales. The women in fairy tales who are more “angelic” are beautiful, kind, and have never done a bad thing in their life. They are also slightly boring and flat characters because all they have is surface value. They are the princesses, the damsels in distress. The women in fairy tales that have monster-ish qualities are beautiful on the outside but literally turn into monsters (Maleficent in Sleeping Beauty, the Evil Queen in Snow White), their desire to have power is what makes them monsters (a possible result of mostly male authors), and they usually have some kind of backstory of what bad thing happened to them in their life to make them turn evil. When discussing this feminist theory in my Critical Theory class I found it very interesting, and we looked at specific examples that both engaged with this (Snow White) and challenged this (Mulan).
Gender in fairy tales is usually mostly binary. I have never seen any fairy tales that include transgender or genderqueer people, and while we are progressing to a more openly diverse society, I’m not sure if we’ll see anything like that for quite some time.