Its already bad enough to stand next to another guy like that, but lowering your entire pants is just unforgivable.

Alright, so Poison is originally from the arcade beat'um up Final Fight. In that game Poison and her pallet swaps are clearly referred to as women in the original Japanese. However, when Capcom was getting ready to export the game overseas somebody said "Wait a minute, Americans have some holdups regarding violence against women. Better say Poison and her pallet swaps are crossdressing men so nobody thinks you're beating up girls, even if they are gangsters."

Because of this a lot of people outside of Japan think Poison's supposed to be a Futa or a transperson because she's too scantily clad and shapely to be mistaken for a man who's simply crossdressing. Hence the penis jokes even though she started off as all woman in Japan, and as far as I know she's still considered 100% true born female over there. No idea if the non-Japanese perspective has bleed back in to Japan.