Quoted from poppapin:Girls will be boys and boys will be girls
It's a mixed up, muddled up, shook up world.
... except for Lola!
Anyone who thinks the song is "about" a transvestite is missing the whole point. It's deliberately ambiguous.
"But I know what I am and I'm glad I'm a man
And so is Lola"
Is Lola also glad, or a man? Could be taken either way.
If anything, the "except for" part implies she is not mixed up. Then again, maybe that was because she switched, as trans people will say they didn't feel right until they did.
Very clever songwriting, many people miss the subtlety.