Well, the way I see it there's three ways to approach gender (of the player-character) in a game:
1. Irrelevant. This would be 90% of games, IMHO. Either the gender is completely unspecified or it's purely window dressing. For instance, you could choose male or female in Ultima IV. Had absolutely no in-game effect. That was pretty common for RPGs in the 1980s.
2. Predetermined. Gordon Freeman is a guy. That's just the way it is. Alyx Vance is a woman. That's just the way it is. Does this mean that the developers over at Valve are biased towards heterosexual men just because the lead character is a male and has a female love interest? My answer would be no. That's simply the narrative decision that was made. In theory, they could have created way more content where Gordon Freeman is replaced by Greta Freeman, and Alyx with Alan, and you play a brilliant, crowbar-wielding female physicist, falling in love with the son of a colleague, etc. Or even mix/match so you could have homosexual love interests for either character. And if they had done so, HL2 would have taken 5 more years to develop and cost $200 to cover all the extra work. Customizability has its costs, and often one of them is narrative depth. If you want strong narrative (especially including pre-rendered/prescripted cutscenes), you typically need to make those fundamental decisions about characters in development rather than allowing the player to make them in-game.
3. Branching. This would be the Mass Effect model. You choose gender at start, and it does have an impact on both the play experience (different voice actors, for instance) and/or the narrative experience. This gives you a much better chance to identify with the character, and also increases replayability, but it has its costs. Development cost/time can be significantly increased if you need to write and record multiple versions of dialogue for every step in the game. Narrative can sometime come off as disjointed, because you don't have an editor making sure that the player's choices flow in a realistic progression (Example: switching back and forth between Paragon and Renegade dialogue options in the same conversation make Shepard come off as bipolar and slightly unhinged).
#3 is a relatively new model for game development because in the past it just meant a ridiculous amount of work. With the new emphasis on replayability, it's garnered more attention even though BioWare still continues to be the only developer to really put that much effort into it. (Although Saint's Row 3 had a nice amount of customizability as far as gender, it had little effect on narrative.)
I can't help but feel that players and critics both have been a bit spoiled by the recent wave of branched-narrative games and are now judging much older games through that modern lens.