How can I support a difficult coworker struggling with gender dysphoria?

Hi everyone, I (25F) have a co-worker (27M) who presents entirely as male, uses he/him pronouns (mostly, sometimes they/them, but not very often) and has an objectively intense obsession with women, in particular, a certain kind of manic pixie type-casted female celebrities from the 90s. I am a cisgender femme lesbian.

My coworker frequently talks about vaguely having gender dysphoria, but more so because he appears extremely fixated on lesbian relationships and lesbian culture (in particular, style, a sense of independence, an interest in art and film culture, etc.). I told him that he can transition to female if he wants, but he always gets upset with me when I bring this up, repeating that he's too hairy, too tall, too whatever to be the "perfect 5'1" dream girl" he wants to be. He also has said repeatedly that he thinks a lesbian girlfriend would "fix him." Kinda incel vibes.

I finally confronted him and told him that he can sometimes sound genuinely creepy and borderline misogynistic, especially to people he doesn't know very well. He said I was being transphobic because he *might* want to transition. He has recently started to just become kind of a jerk to me after we had this conversation, insulting things I like (books, movies, shows, video games), and constantly whining and bemoaning about how "all lesbians" are "so transphobic."

I know he may sound like a bad friend, but he does share similar interests with me and can be funny, making our work a bit less insufferable (though not right now, I suppose). Also, I have told him numerous times that he can transition if he wants to and that, since our coworkers and boss are very liberal, it wouldn't be an issue socially. Also, our work insurance covers a lot of expenses for gender transitions and hormones (at least for now). And yes, he did ask me out on a date (before I came out as gay), and I had said no.

I have quite a few transgender friends, even a few growing up (from middle and high school), and a lot of them acted like this before their transition, primarily out of a sense of intense dysphoria and their frustration with their bodies and the way they are perceived interpersonally. I'm in a difficult position where I want to support this person, but I'm also deeply uncomfortable and unsure about how to address his behavior. I'm particularly concerned about whether his behavior could be considered a 'fetish.' I'm aware that this is a sensitive topic for many trans people, especially transgender women, who are often accused of transitioning for the wrong reasons.

Given the complexity of this situation, I would appreciate some guidance. In particular, I want to get advice specifically from any trans lesbians who may have suggestions on how I should support this person, or whether I should stop engaging. I want to emphasize that my coworker has never been in a relationship before, which adds another layer to the situation.