Irene Adler is a woman who wears men's clothes. Whether she wears them for convenience or simply because she enjoys it, John cannot say. Whatever the reason, she is as striking in trousers and a waistcoat as she is in a dress, but even when she has her hair tucked up under a cap and her bosom flattened, there is still something feminine about her.
Sherlock Holmes is a man who wears women's clothes. He wears them for practical reasons, and John admits such disguises have been immensely helpful in solving more than a few cases. In a dress and a wig, Holmes can handily fool his marks, but though John has been taken in by other disguises, there is always something off about Holmes in a dress, an awkwardness only John can detect.
John Watson is a man who loves other men. He loves the hard planes of a man's chest, the rough scrape of stubble along his jaw, a thick prick to fill his mouth and arse. Sherlock Holmes lacks all of these, but John has always known Holmes is a remarkable man, and he finds to his surprise that he does not miss these things at all.