If anyone needs it spelled out, think of it as trans allegory.
I think that it's rather accidentally-insulting as a trans allegory or similar though, that's the exact problem. It reminds me of a couple of other unfortunate or aged-poorly Trek allegories best left to history. More than a couple actually eesh.
I think having parents using intentional genetic engineering on their unborn children to attempt to achieve "superior" or "upgraded" beings as an allegory for any real-world group, a real-world group which is genuinely being punished for merely being born that way is extremely misguided at best, actively harmful at worst (it also sort of goes against the original characterisation of the Illyrians, where they did it solely due to necessity, never mere whim or < Fiddle on the Roof voice > TRADITION!!!).
If they'd been very careful in how they depicted it, too, that could have worked - but unfortunately repeated attempts to defend the parents unnecessarily doing it as a "cultural tradition" and therefore 'fine and dandy' as it were really undermine that. DS9 attacked the parents for doing it - Bashir was very upset too - and if SNW had also taken a negative attitude towards the people doing (given it wasn't needed - the original Illyrian reason for doing it), or at the very least presented them as misguided or hidebound, I think allegories would have worked better.
The allegorical element is also undermined by the peace-and-love bit at the end where everyone agrees the Federation has been "traumatized" and thus shouldn't be judged too harshly - if this is a trans allegory, what the hell is going on there? We should forgive the TERFs because of the trans-wars which never happened lol? Obviously it breaks down there, but I think it's best not to see this as an allegory, because you're just digging a hole deeper at that point.
We already know that Una's case will not alter the Federation position - Dr. Bashir runs afoul of the same rules against augmentation in DS9.
I could not be more aware! Bashir is one of my favourite characters in Trek (I know, I like a smarmy English guy who loves to needlessly overcomplicate situations, try to act surprised!).
My point wasn't intended to be that they needed to change the Federation position - rather the re-introducing the Illyrians to half-heartedly try to argue a contrary position even though
they know that position
can't change is, at best, a perplexing writing decision.
Thankfully it seems to be over, hopefully forever, and can be consigned to the same locker as "Profit and Lace".