Yes, that's pretty much it. This basically boils down to the conservatives' belief that being trans, queer, or gay is something one chooses to do, and therefore can potentially be persuaded to become. They also believe that being trans, queer, or gay is fundamentally wrong. So in their world, a kid seeing a drag performer in a positive light carries the risk of influencing the kid to become trans, which to them would be a tragedy.
As I keep having to point out to my 20-something year old kids....conservatives really do live in an alternate reality.