The argument is that, if the definition of women includes trans women, any association for lesbians must admit trans women who are attracted to women and, if they don't, they can be sued for discrimination. However, if the association is for gender critical lesbians, they can exclude trans women (although, as you say, that probably doesn't prevent a trans woman claiming to be GC in order to get round the restriction).
This yet again highlights the ludicrousness of the TRA position. For me, it reaches the heights of stupidity (actually, I want to use a much stronger word here) when lesbians are branded as bigots for refusing to sleep with trans women.