Just noticed this thread and so, here is my answer to it.
First of, I will confirm that I often seen this term used as a slur too; Or at least in a negative way. However, rarely in products (like games) that features them with this word, of course, but more like in comment of such products or sometime in some channels of some platforms or IRL.
That being said, this is effectively generally not use to be knowingly transphobic, but more like as a slander, stating that it’s either to lure those of the sex opposite to the one they appear to be or to get closer to people of the sex they appear to be (hence this word).
Plus, the people using this word generally don’t know the difference between a trans person, a transvestite (now called cross-dresser), a femboy/tomboy (I have even see someone use the term tomgirl recently ; I’m still not sure if this was really simply an error or if there really a meaning behind this), and a shemale, but even when they do, some will generally still think that it’s the shit and will keep using this term.
Secondly, to be clear about the terms:
- the term Trap is generally destined to the transvestite people (though, as said above, many will either don’t care or have a clue of what they are talking about)
- the term Trans refers to trans people regardless if they have taken hormone or not intend to undergo transition
- the term Cross-dresser (formerly Transvestite) refers to people that dress themselves to look like the opposite gender (hence the new choice of word) without thinking themselves to be of said gender, they will also fake boobs or try to mask them depending of the target gender
- the term Femboy refers to male people that like to dress feminine-like and some of them may also act –to some degree– akin
- the term Tomboy refers to female people that like to dress masculine-like and some of them may also act –to some degree– akin
- the term Shemale refers to people that have a female body but with male genitalia
- I don’t know of any consensus about an antonym of Shemale, but I think the one use in this game (Cuntboy) fit well
I’m no expert however, but I think it’s correct enough.