In some cases, maybe it might. But my case is sort of the other way around. I have, or maybe it's past tense now, had gender dysphoria for a very long time. So at least having barely noticeable male genitalia is kind of nice in that way. I am also asexual - not as a result of hypnosis or kink, but that is the way I am, though it took far too long to figure it out! So again with that, not being able to get erect is now a convenient excuse if I ever find myself in the position of needing one (which I don't want to) - "Sorry, I can't have sex because I'm impotent." No need to say I deliberately made myself that way.

I'm also more overtly gay now, thanks to other files here like Heterosexuality Eraser. So here I am - gay, asexual and with an impotent, limp, tiny penis.
So that's the way it is with me. It's probably going to be different for everyone else, and I'm sure the idea of gender dysphoria for anyone else shrinking their penis is actually something worth considering. Myself though, I'm very happy about it all!