In the “Pleasure Dome” of Rise of the Dragon, one of the characters the player can interact with is Darcelle, who is “a woman posing as a man, posing as a woman” (see image below). You can see some of the interaction with this character in this video at about 6:30.

Darcelle
Image credit https://www.youtube.com/watch?v=t8O9MLvU4hk
Reportedly, homosexuality is one of the “vices” that patrons can engage in. Also, it is reported that at one point in the game the protagonist flirts with someone he believes to be his girlfriend, but turns out to be a man with long hair. We haven’t found confirmation for these two references, however.
Citations:
- DLambert. (2003, April 1). Rise of the Dragon: A Blade Hunter Mystery. Game FAQs. http://www.gamefaqs.com/segacd/587987-rise-of-the-dragon-a-blade-hunter-mystery/faqs/17845
- Gay, lesbian, bisexual, and transgender character in video and computer games. (n.d.). Retrieved from http://enc.slider.com/Enc/Gay_characters_in_video_and_computer_games
- koobert. (2009, August 26). Let’s Play Rise of the Dragon- Part 03- Darcelle’s Dancers! YouTube. https://www.youtube.com/watch?v=t8O9MLvU4hk
- LGBT character in video games. (n.d.). Retrieved from https://en.wikipedia.org/wiki/LGBT_characters_in_video_games
- Marr, R. (2014, November 14). Game Change: The State of LGBTQ Gaming. Metro Weekly. http://www.metroweekly.com/2013/11/game-change-the-state-of-lgbt/
- Winkie, L. (2014, April 18). From a pink dinosaur to “Gay Tony.” Salon. http://www.salon.com/2014/04/18/from_a_pink_dinosaur_to_gay_tony_the_evolution_of_lgbt_video_game_characters/
- World of Longplays. (2007, April 23). Amiga Longplay Rise of the Dragon. YouTube. https://www.youtube.com/watch?v=FKpkkQH6ZT4