AITA for refusing to acknowledge my emotional Nieces pronouns?

My M31 niece F18 just came into town this week. She lives across the state and me and my wife F30 rarely see her, it’s gotten to the point that the only time I see her is when someone else she lives with comes into town, and she’s forced to tag along. I was close with her when she was younger, but once my brother moved away I stopped seeing and speaking to her often. I won’t speak to my brothers parenting style, since I don’t have kids and aren’t planning on it, but it’s definitely different than how I would raise a child.

My niece has had loads of behavioral problems for years, as I’ve not only seen them in person, and in my own home, but I’ve also heard plenty of things from my brother, parents, and SIL. I won’t get into the behavior problems too much but essentially lots of lying, sneaking out, failing school, and eating poorly. I don’t know why this is going on, and I have never asked.

3 days ago, my brother, SIL, and niece come over for a little gathering, my parents and my wife’s parents are also here, as well as a few of my nieces cousins. It was fun, nice to catch up with everyone, and all around an enjoyable experience, until I started asking my brother questions about my niece, that she happened to overhear. I asked my brother how she’s doing in school, and my brother nodded and looked somewhat nervous, I was a little confused but then suddenly my niece, who was sitting on the couch, turned to me and said, “it’s he, not she anymore”

I was confused and to be completely honest, didn’t think much of the comment, I thought maybe she was joking, going through some phase, or whatever, I just continued on with the conversation after nodding and smiling, since I didn’t know what else to do. I noticed that my brother avoided using any pronouns at all, but I didn’t call him out, I just continued saying “she” “her” etc… and my niece didn’t seem to hear the rest of our conversation.

Maybe 30 minutes later, I went to talk with my niece, who was not smiling, sitting by herself, and clearly didn’t enjoy being there. She was dressed in feminine clothes and her hair was long, like a woman, so I assumed at this point, she was joking. So I kindly asked her if she was, and she looked at me with a cold and angry expression.

She said she wasn’t joking, and she’s incredibly insulted that I would assume that. I then told her she’s still going by her feminine name, and wearing all feminine clothes, she’s clearly not a man, and that she needs to relax and enjoy the gathering. She then stormed off outside, and I didn’t speak to her the rest of the time she was there. A few hours later, my brother asked me to just “go along with what she wants” and that it’s best to not take this too serious. I told him she’s not a man, and this really shouldn’t even be a conversation we’re having, I told him I will not be calling my very female niece a man, and referring to her as one from now on, simply because she wants to, that’s ridiculous. My brother agreed but told me that she’s upset and doesn’t want to speak with me, I wasn’t trying to be rude, and my niece can think what she wants, I’m just calling her what I’ve always called her since she was born, and I don’t see anything wrong with that.

AITA?