Wasn't really sure where to post this, but this seemed like the best place.

I met this woman in my Zumba class and we became friends. She's really nice and I enjoy the camaraderie. Tonight, she told me that her daughter asked why I had a purse and wore women's exercise clothes to class. Her daughter is 6 or 7. She didn't know what to say and while I'm totally open about my trans status, her and I had never had the talk. So we did and we determined that her daughter could ask me questions next time she comes and I'd try to explain things as best as I could.

I imagine her question will be something like this followed by my response:
"Why do you dress like a girl?"
"Well, most boys like to be boys and most girls like to be girls, but sometimes boys want to be girls and girls want to be boys."

Of the people here that have had to explain ->-bleeped-<- to children under 10, what were some of the ways you answered their questions? I feel confident enough in myself that I can talk about it with a kid, but I'm curious about others' answers and I'd like to tap the collective community wisdom.

I won't claim to have any expertese with children.

This is one of those situations where you will essentially, increase the child's awareness of it's environment. Since the mother has agreed to it, that makes it the better. But your objective here, especially with such a young child, will be to give them the information they can manage, help them to over come any negatve notions they may have been introduced to and reinforce the normal boundaries that the child will need to learn.

I would emphasis the happiness aspects. That some people, very few, but some, find they are not happy with what they were born with.

For more intelegent and mature children, I might ask her how much she likes being as girl. Then ask her how she might feel, waking up to discover that she looks like a boy.

If she askes about anything personal, I would say to her that just as you have parts of your own life that are personal, so does everyone else.

My daughter is 6 soon to be 7 and I always felt the best answers where the simplest honest ones. When I came out to her I simply told her that I wanted to be a girl, and that I would be taking medicine to make that happen. That answer has satisfied her for the last 3 months. She loves to tell people "my daddy wants to be a girl". Kids that age are just figuring out what gender roles are and typically are not very concerned with any details. 

I think your answer will work just fine.  Kids that age want simple answers.

I once had to explain being gay to a 7 y/o.  I told him "Some boys like girls, and some boys like boys".  That's all he cared to know.  Sounds alot like the answer you were planning on giving anyways.

The two contributors who followed my post, clearly have experience. I suggest following their advice rather than mine.

I was turned into a boy by an evil witch. I only recently got myself turned back.