I agree with Kampire that this is a crucial issue for feminism because it really forces us to ask what we think about sex and gender and sexuality at really basic and threatening levels. There also aren't, it seems to me, any crystal-clear answers for people who don't want to discriminate, yet as Brooke mentioned, don't want to lose the sense of security that they once had either.
Frankly, I have no idea what The Sisters should do about transmale students, but I am also torn on the issue of single-sex education overall. My suspicion is that colleges segregated by gender will go the way of colleges segregated by race, and so we will have Historically Women's Colleges in the US just as we have Historically Black Colleges. The schools will still be predominantly women, and women will still largely set the norms and the terms of the environment.
I'm not sure that would be such a bad thing, though I can only speak for myself here because I've never attended a women's college and so do not know what would be lost in such a change.
-------------------- No matter what your fight, don’t be ladylike! God Almighty made women and the Rockefeller gang of thieves made the ladies. ~Mother Jones