That doctor needs to go on one of the NHS courses about trans issues....
It may be the case for very young children that they grow out of trans feelings. My son's friend (E) lost his elder sister in a car accident. She was just 16. E grew his hair long and worse dresses. Fair play to his parents: they let him. They did go and see a child trans specialist, but as he was only 6, they just monitored him, because they didn't know if it was trans or trauma, but suspected trauma. When E got to 9, he stopped wearing dresses. it was the way he filled the gap that his sister had left.
There was no peer pressure on him to conform, all his friends were quite happy with him as a girl. He came to my son's birthday party in a pretty frock and with his hair braided. If I hadn't have known, I'd never have guessed.
However, as the children's services guessed, it looks like it was trauma.
It may be that E will revert back to dressing as a coping method, but one thing that told me he wasn't trans was he never wanted to change his name and when I asked him, he said he was a boy.
Now, for this, I'm a little unsure. Although his friends were happy, his parents were happy, and his school were happy, was there a subtle pressure from society that said "be a boy" and he's 'conformed'? I'm no expert, so I have to assume the specialists are right. Only E knows for sure.
For adults though....different story, we have more robust coping mechanisms. Did you never dress at all before losing your wife? Never have the desire to?
Your children sound old enough to deal with the information that you have trans feelings. Perhaps next time you're talking to them, you can sound them out with mention of Bruce Jenna or Eddie Izzard and see how they react to him. If they are seemingly accepting, you can then add "The reason I brought that up..."
Assuming you want to. There is no hierarchy, you don't HAVE to tell them. You should only tell them if you feel you're not living authentically and want to. Do this sooner rather than later, so your gandkids have a grandma, not a granddad. They'll take it in their stride.
As to the sex thing. A lot of trans people want the 'authentic female experience' and would consider things they wouldn't ordinarily consider. Again, it comes back to being honest with yourself. There is absolutely nothing wrong with finding men attractive, and wanting to be with one in a romantic way. There is absolutely nothing wrong with being bi or bi-curious. You might decide to try it, and not like it - and that's fine too. Never do anything you're not comfortable with, if you go with that, you'll be okay, whatever path you choose.