Some years ago I read a book 'Stone Butch Blues' (is that the novel?) and I suppose that is where my idea of what butch is stems from. Basically, a lesbian who does not have any 'feminine' traits (that's more than 'style' - you can be wearing short hair and clothes associated with men and still be feminine, just by the way you move and flick your hair and relate to other people in the room, for example).
I remember the book to have been really interesting, historically. For example the thing about when there were police raids on known gay hang-outs, every person was required to be wearing at least three items of appropriate-sex clothing/accessories (clothing at the time being seen as something to do with sex, not gender; gender or rather the distinction between sex and gender not really a thing altogether). Else they were arrested (for homosexuality). This was a problem for half the lesbians (the butch ones) and half the gay men (forgot the term of the times, but would have been the feminine ones). Because apparently at the time, you had to be either/or, either extremely femme or extremely butch.
Also that being a butch lesbian automatically used to signal that you were sexually interested in femme lesbians only. I remember the sense of taboo-breaking and betrayal the protagonist felt when she had a brief sexual encounter with another butch lesbian/heard of two femme lesbians being together. By the end of the period covered in the book, this had become more normal though. It was interesting to see how the idea of what it means to be butch changed even within that timeframe.
So perhaps at the beginning of the time covered in 'Stone Butch Blues' butch referred to sexuality, as in, 'a woman sexually attracted to/attractive to femme lesbians'. You couldn't say 'gender' (as distinct from sex) really as that would be sort of anachronistic. At the end it was different, and it has changed since then. Today it seems to me that a lot is reduced to 'style'.
It sounds to me that butch nowadays is often perceived as a style, and as such open to anyone, male/female/straight/gay; and something you can 'put on', so one day you can go out butch, the next day feminine, it doesn't affect your identity/who you are. And I guess that I would see it as such too. Whilst remaining aware that for some butch lesbians, it might be more than 'what should I wear', and form a fairly basic and important part of their identity, including their sexuality. That for some people, butch is who they are, even if some days they wear a dress and makeup.