In Mandarin, 'he' (他) and 'she' (她) are both pronounced 'tā' (same sound and same first tone). And I had convinced myself that because the two words sound the same, that in the mind of Chinese people it must be easy to confuse the translation into English.
But there were two things that kept bothering me ... (1) I figured Chinese people were more likely to think in terms of characters than pronunciations (since so many words sound the same), and (2) Why was the confusion of he/she so much more common in Hong Kong than mainland China?
Clearly, this wasn't the explanation I was looking for. (*)
And it was only a couple of weeks ago that I found out! Which surprises me since I've been living in HK for nearly three years already.
It turns out that in Cantonese they actually use the same word for 'he' and 'she' - 佢. In Mandarin, this is pronounced qú, and in Cantonese it's pronounced keoi5. Yes you can find both 他 and 她 in a Cantonese dictionary (both pronounced 'taa1'), but it's not the one they use. So now we know.
佢 ... Yes, the force is strong with this one. (*)