In order to become a Buddha, she first had to become male, using supernatural powers, in the story in the text itself.
The story is often used to stress the universality of Buddha-nature, and that all beings can attain Buddhahood, regardless of gender.
But if that is the case, why in the source text, does she first need to become male before she becomes a Buddha? The endless questions these strange scriptures give us.
Most teachers of the Lotus Sūtra actually contradict the text of the sūtra itself to give a different spin on the story.
Chan Buddhists have traditionally used the story as a precedent for “sudden awakening”. But this also contradicts the text itself, as her/his becoming a Buddha is indicated to be preceded by many aeons of bodhisattvayāna practice of the 6 perfections, and is not “sudden” at all.
On the wikipedia article concerning the Dragon’s Daughter, it says:
According to Schuster, the Lotus Sutra’s argument “is directed against the notion that some bodies (male) are fit for the highest destinies, and other bodies (female) are not.”
But if Schuster is correct, that this is the “argument” of the story, why change her into a man? Questions, questions…
This is further complicated by other areas of the sūtra, where it is stated that one of the benefits of being a votary of the Lotus Sūtra, is that if a woman becomes a votary, that will be her last birth as a woman ever, and she will take on male births from then on.