It's all dependent on context. In private I don't think a lot of people would have a problem, even a lot of those who said they would in this thread - though it might be a bit cringy to watch (yes I know acceptance is good and stuff, but seeing a kid walk around in princess clothes just naturally makes me cringe, even if I accept it). In public, e.g. at a fancy dress party, I'm not as many people would, simply because of that cringe/embarrassment factor. People have to maintain their image, right? It's not really an issue around ages 2-6, but after that it slowly starts to become an issue as they and their friends get an idea of what is "boyish" and "girlish".
As such, I'd probably be fairly lenient on it, but a line has to be drawn somewhere. I can talk fancy all I want about equality and breaking gender barriers, the kid should at least maintain a somewhat cool public image if his friends don't think "girly" stuff is "cool", it's not nice to get picked on for it at that age. If he feels and thinks more like a girl and decides he wants to be one, then that can come in teen years, when nearly everyone understands these gender lines and that boys don't have to be "cool" and stuff.
/s