Help with talking to a 12 yr old about trans issues

Comparing transgender to an eating disorder is grossly, grossly unfair and you know it.

"Some people believe" is much better than the faux confusion of "how do I explain it?"

If you want to play comparisons, there is a wide variety of reasons a child might be "different" from others. there is no league table.

It's all very well playing ifs and buts on a forum and claiming you would march up to people and tell them they're deluded, but ultimately children have to learn to adapt.

I would fully expect a school to come down hard on any child treating any child badly - trans or otherwise.

Incidentally, as I said above - teenage students tend to cope just fine with trans pupils.

Wonder why.

Any advice for how I can discuss this sensibly?
Listen. Ask questions.
Let them come to realisations themselves.

Well, firstly, I would think about adapting your language and how you refer to things, as this will pass on to your child.

ie - a "special toilet assigned just for them". Children in schools use toilets on their own for a variety of reasons.

am quite certain the parents are simply going along with the whole thing because they are terrified of their child’s mental state and what they might do next. I feel very sorry for them". How can you be "quite sure" of the motivations of people that you don't know?

Put simply, this child feels internally that they are male, not female.

Children get it. The number of trans students is on the rise. The kids are fine with it. It's the parents who struggle. Please be acutely aware that any judgements, however much you try to water them down, will be very obvious.

Explain that most people once believed the Earth was flat, and in the past people thought diseases were spread by bad smells, and that people of different races were of inherently different worth, and those things were ‘explained’ to kids in schools as well. Something can be untrue even if every person on Earth thinks otherwise.

You do it like you do for people who believe in religions that you don't. You can say that some people believe that they have a gender identity that is separate to their physical body, etc etc. Because it is essentially a belief system, one that is seeing a surge in popularity, but one that you don't ascribe to. I would then explain why you don't have the same beliefs, and be clear that no human ever actually changes sex, but some people feel that they need to alter their bodies to superficially resemble the opposite sex. And some simply want to dress and behave how they think the opposite sex does. At this point you could talk about sex based stereotypes.