The conservative estimate is 660K trans people, the latest estimate is 1.3 million people
The reason why only just under 5000 people have a GRC is because the GRA has worked precisely as intended - to give legal recognition to transsexuals who have medically transitioned and lived for many years by adopting the gender stereotypes associated with the opposite sex.
Before you award someone the legal status of the other sex, a gatekeeping process is needed to protect society from those who would pose a danger to members of the opposite sex and from those who would abuse the system.
So, the GRA is working properly for the transsexuals it was written for.
The 660K are on the whole transgender not transsexual. At least 80% of the UK's transwomen have no intention to ever medically change their body and 95% so far have not changed their body. The vast majority if not all of the 95% are attracted to females.
The GRA is designed to prevent such intact males from receiving a GRC. You might want to ask your DB what purpose a GRC would serve for an intact, straight male who enjoys having penetrative sex with women and has no intention of ever giving that up.
Intersex ppl do not fall into this category and I would tell your DB they have nothing to do with the issue and want nothing to do with the issue. Theirs is a physiological problem, trans is a psychological problem.
They also seek opposite solutions to their problems - less medical intervention in intersex children that seeks to fit them into either a male or female box. Trans ppl are asking for more and ever earlier intervention in children so they can fit neatly into the male or female box of the opposite sex.
P.S. The estimated number of males who potentially have a transvestic fetish is 1.3 million UK males. Some men with a transvestic fetish enjoy using women's spaces as part of their fetishistic role playing and will avail themselves of any opportunity to do so.