On the original topic:
Generally, it strikes me as a little strange when people suggest that a historical fantasy shouldn't have nonbinary (or female, or gay) characters because of 'realism', when that fantasy also might have ghouls or giant twelve-headed monsters or fairies. None of those fantasy characters are real, but nonbinary (and female, and gay, and etc.) people are real and always have been.
I didn't mind the way the explanation was handled. My PC was a child at that point, so it's a stage in life where you're learning all kinds of things about the world around you and explanations of basic social issues make a lot of sense. Also, I recognise a lot of the audience may not be familiar with the idea of nonbinary individuals yet, or not know those terms (especially when English is a second, or third, or fifth language), so an explanation could be helpful or even possibly necessary.
I also found choosing my sibling's gender a little creepy for modern political reasons, so I was happy to see that we didn't actually get to assign our sib's gender at all. I like the subtext (at least, that I perceived) that we don't get to make the decision on other people's gender.
There's also the question of cake. When people write very excellent worlds with a certain degree of historical continuity and then make the artistic choice to genderlock their very excellent games—say, @Cataphrak's Infinity series or @heather's Study in Steampunk (one of my favourite IFs), then people are bothered they can't play as their preferred gender.
On the other hand, if an author (sometimes the same author, even, but with a different work) chooses to allow the PC to be the same gender as the player, whether that's nonbinary or female or what-have-you, there are protests (reasonable or not) of historical inaccuracy. And if the PC is able to be nonbinary or female, but no-one else in an equivalent role is, that's just odd—and even more inconsistent.
Both kinds of games are important, but they tell different types of narrative. It's not so easy to have the cake and eat it too.
As for including nonbinary characters in general, I think it's absolutely necessary. For one thing, a big part of CoG's awesomeness is its inclusiveness. Also it's exciting to me to play in worlds where I can model my character after myself, and feel welcome (or as welcome as my peers, at least, for games with more turmoil or a hostile environment). I hope to be able to extend that welcome feeling to my readers someday with published fiction and games.