Most children's books don't go into the details you fear, and simply seeing a man in a dress isn't going to 'instruct about LGBTQ issues', it will only show the child that such exists. So that those children who feel similar know that they're not alone. That they're not freaks that shouldn't be alive. Better chance of them living to grow up that way.
You are talking about children as young as 3. With much older children you may have an argument, but not very young kids.