How would you know?

What do you mean? Most recent games I've played have had male and female characters as humans. In Mass Effect there are the asari who are a mono-gendered species, but even they are portrayed of being a very feminine species altogether. The approach still tends often to be heteronormative (= there are two genders) and cis-centric.

I'm referring to how the character would look. What would be the point? A transgendered man would look like a woman, and vice versa. Also, a transgendered person identifies with the opposite sex (from my understanding). E.g., a transgendered man would identify as a female and would play as a female if they wanted to.

You are referring to transsexual men/women. Transgender is a broader term for all kind of gender variance.

The option of Transgendered doesn't need to be in the game for your character to be so. Your gender variance is totally up to you, in the same way your character's back story, decisions, and interactions are. Now, if you want certain Physical aspects from each gender I guess you're out of luck, but then there are many games where you can customize body proportions. Elder Scrolls, EVE online, and Dark Souls (Kinda) to name a few.

Well this is getting farther and farther from the point of the thread, but here goes: I'd counter argue that the same approach you described could be used for gender in general (no need for women in games), ethnicity (you can imagine what's under the helmet) or sexuality (even though the narrative only mentions straight couples, your character can be gay, you just need to imagine it). I'd love to see more gender variance in videogames and characters that break the genderdichotomy. And it'd be great to see that implemented in the narrative of the story and in character creation as well. Saints Row has a great approach on character creation for instance, in my opinion. So yes, I'd play a she-male (transgendered) character if one was implemented in the narrative of the story.

You do have a point. Unfortunately video games aren't "there" yet. What I was saying was just a way to be able to try and play the way you want with the character you enjoy playing as. It's been a pleasure talking about this, I rarely find someone who knows what they're talking about while also being friendly and willing to talk, cheers.