The Plunk said:
I'd come to a compromise, and make him wear wizard robes.
Ninja'd. In all honesty, I would not support my son wearing dresses at that age. Reason being is that I'm definitely a "nurture-ist" (nature vs. nurture argument...look it up). My concern is that odd behaviors that I reinforce as a parent (in this case the wearing of dresses) could become a set pattern for this child's life without them having a logical say in it.
At this point in their life, I doubt any 5-year old is considering the gender and social ramifications of his actions. They are probably just wearing dresses because of some positive, tactile reinforcement (maybe dresses are a lot less restrictive). Because they can not directly understand the social risks that they are taking, parents need to adequately mirror societal norms so that, should the boy reach an age where he's able to consider the risks with some intelligence, he'll already have a sort of understanding what these choices mean. A good analog would be diet. Kids (at least all of them that I know) want to eat junk food. As a parent, you have to measure providing them with what they want (sugar) with what they need (vitamins and such).
When you reinforce the socially abnormal as completely acceptable, you are not preparing your child to integrate into social settings with any sort of ease. Once they hit school age, they may still make friends and gain acceptance, but it will potentially be more difficult. Kids in my class would have had a field day with a boy in a dress. The boy may gradually gain acceptance, but it may be a very "Boy Named Sue" type of acceptance, where it comes through heartache/pain.
As for those who say that he'll grow out of it. It's very possible. However, consider that, in these days of the internet, I know who this kid is from across the world. I can only imagine the horrifyingly embarrassing things that this generation (who will have grown up their whole lives with their parents posting whatever happens to them as a kid on Facebook) will have to suffer through because of the internet's way of never letting you escape what's already out of the box.
I'm not trying to be sexist (though I know that's what people will claim me), I just think it's unfair to set up a child who doesn't understand the consequences of their choices for future heartache and embarrassment because you want to seem like the most understanding parent in the world.