I think it's perfectly possible to confuse young children about sex if you tell them that they can change sex, or choose their sex, or that some people are somehow not the sex their body would suggest - there is an age below which they will absolutely believe this is possible, and that a change of clothes/hair will change them into a boy/girl.
When it turns out to be not possible as they grow into better understanding and approach puberty, they will definitely be confused, and possibly angry, and definitely distressed.
And, given that our reproductive instincts are pretty accurate, children can definitely be confused if authority figures, such as teachers, tell them that another child is a boy, when their instinct is that this is a girl (or vice versa). They know one thing instincitvely, but adults are telling them otherwise - I am pretty sure that this will confuse them. Especially if they are taught that it is necessary to use pronouns that don't match the sex of this other child. That is sowing confusion, and I see it as gaslighting.