At first glance at your comment I said "how would that help". Then I thought about it a second time, and I think this is actually a legitimate way to approach the problem of gender identification. So +1 for me.
Some might prefer the gender-neutral pronoun "they".
However, I think doing things this way is going to be quite difficult to implement when you consider multiple languages. Male/Female/Other with an option to hide this information is much easier a solution.
I'm British: I use it quite often. Maybe it's rarer in the US?
"John was late for dinner. They were caught in traffic." is perfectly correct usage (however if you'd just called somebody by a gender-specific name there's not much point in then being gender-neutral).
Wonder what others think