I believe one reason is because the partner feels "lied" to. How can someone be one day a full man, with male features, and a "male" personality; the next day just "up and decide" to look, 'act', and BE a woman? You'd feel lied to, and betrayed.

Other reasons could be they don't know how to accept it, how to deal with it, how to get to know this "new" person.

The issue with better confidence and self esteem could be it.

And of course, we're talking of gay couples. A man who is attracted to other men obviously does not want to date a woman even if "she" does have male parts. If that were the case what would stop him from dating an actual woman with a strap-on? Thats not it. A homosexual man wants to be with another homosexual man. Not with a transexual or man who wishes to be a woman. That would make it a heterosexual relationship.