There realistically is only 2 uses for it in the game
1) A NPC is referring to you in the third person and not by name or some other label (like pirate, asshole, spy, etc). Such as "We found him in the cargo bay" "We found her in the cargo bay" "We found them in the cargo bay"
2) A NPC is attempting to address you by a formal title that is typically assigned to a specific gender/sex. So Mister, Misses, Madam, etc.
If you look back at prior Fallout/Morrowwind games going back 25 years or so that have lots of spoken dialogue, they will have NPCs do that, but it isn't very common. Which makes sense - it reduces the number of spoken variables needed in a conversation. In most cases, the conversation is going to be completely identical with minor nuanced changes that make it slightly more customized to whatever character you are playing.
So while you're all freaking out, realistically them adding some neutral pronoun isn't going to change much, because they barely used regular gendered pronouns in their other games in the larger scheme of things due to the extra work it took and already used genderless options previously because they could just use them universally. The only thing that has changed is they are making some flagged option during character creation that eliminates the variable dialogue.