Recently a member of my gaming social circle introduced his friend (hence known as New Friend) to the group, whom he clearly, in my opinion, referred to as "he" both in writing and in speech. New Friend is clearly trans, as he is burdened with a stereotypically female body and voice that could not be hidden despite masculine clothing and mannerisms. I can see how this would present trouble to those not passingly familiar with the LGBTQA community, and even to those who are. However, one member of the group (hence known as Clueless) just could not - or possibly would not - wrap his head around the fact that New Friend should be referred to with masculine pronouns despite subtle reaffirmations and even a few direct corrections. Clueless constantly threw out "she" and "her" to the point where I began to believe that he was doing it with intentional disregard of New Friend and out of laziness, which made me really. angry.
I could not take Clueless aside for a chat without it being very obvious what I was doing, nor could I just call him out at that point without making everyone uncomfortable - my primary concern was New Friend, as I could tell he was already bothered by the situation but was unable or unwilling to address Clueless about it more pointedly. Clueless has been counselled after the fact, but I feel that quite a bit of damage was done.
My question being, does anyone have advice on handling a similar situation with minimal upset? Or would a trans person actually prefer that someone make a public scene on their behalf? I have no difficulty getting in someone's face but I felt that it would only aggravate New Friend's feelings. I would very much like to avoid hurting a new acquaintance in the future in my attempts to make them feel welcome and supported.