The second paragraph of the proclamation says "ALL HUMAN BEINGS—male and female—are created in the image of God." and this truth is very important to understand. When we know for certain that we are created in the image of God, we begin to understand who is God and what is His nature. We are his masterpiece, we are the pride of his creations. He loves us to an extent that he wanted us to look just like him. As a matter of fact, we look like him as a symbol that we can become just like Him. He has complete confidence that if we do our part, with his help, we can be just like our Heavenly Father.
Satan is not stupid. He knows that this divine knowledge will increase our capacity to progress. He does not have a body, therefore he misses out in the opportunity to become like God. And, as the saying goes, misery loves company. Satan will do everything in his power to prevent us from gaining that knowledge so that you can be miserable, pessimistic, doubtful, fearful, full of hate and unbelief, discouraged and hopeless.
In the following sentence of the second paragraph of the proclamation we read, "Each is a beloved spirit son or daughter of heavenly parents, and, as such, each has a divine nature and destiny". As spiritual and literal children of God we have a divinity within us, as mentioned before, to become just like him. We begin to access this divine nature through the atonement when we humble ourselves and repent of our sins. When we make sacred covenants through ordinances in the gospel, we slowly begin to be more like Him. Divine nature is our potential to become like our Heavenly Father.
The last sentence of the second paragraph says, "Gender is an essential characteristic of individual premortal, mortal, and eternal identity and purpose.". I strongly believe that each gender has different, but equally important, characteristics. These are essential to know, because our Heavenly Father and his son, Jesus Christ have a gender.
We can find an example of how gender characteristics work together equally can be found in the book of Genesis. In the garden of Eden there are two trees. The tree of life and the tree of knowledge of good and evil. The fruit of the tree of life represents the ordinance of salvation and exaltation, such as baptism, blessing the sacrament, temple work, temple sealings, etc. The gifts and blessings of this tree are attributed to the male gender. The fruit of the tree of knowledge of good and evil can represent the blessings of the spirit coming into mortality and full material agency. These gifts and blessings of the fruit of this tree are attributed to the female gender.
Even though these blessings can be attributed to a single gender, we can all partake and enjoy of these blessings. The blessings of ordinances through the priesthood, the tree of life, can be enjoyed by males and females when they make covenants and receive priesthood blessings. The gift of life and agency can be enjoyed by both male and female, since we all go through the process of birth and make choices. We are physically born into this world through females, and we can be spiritually reborn through the priesthood held by worthy males.
When Satan confuses people about their gender identity, first of all, he is mocking God. It is his way of spitting in Heavenly Father's plan. Satan knows it is harder for gender confused people to understand their divine nature and destiny. That is how he discourages spiritual progress and how he can prevent us from becoming like our Heavenly Father.