Being a champion athlete requires both determination and innate physical advantages. This is in some sense unfair to people who try as hard as the champions do but, through no fault of their own, lack the champions’ physical advantages. Therefore you can argue that since there aren’t things like basketball leagues for short people, there shouldn’t be separate competitions for men and women either. This is ultimately a matter of opinion, but I expect that you will have a hard time convincing the public. There are separate competitions, and while that’s the case, it makes no sense to allow a person with the specific set of innate physical advantages that men have over women to compete in the women’s competition. The whole point of having a women’s competition is to prevent that.
Caster Semenya is entirely unexceptional by the standards of male runners. For example, she won first place in the Women’s 800 metres race at the 2009 World Championships with a time of 1:58.66, which would have gotten her 47th place (out of 48) in the men’s heats. She would therefore not even run in the semifinals. The winner of the men’s race had a time of 1:45.29, more than ten seconds less than hers. I don’t see the appeal of watching her win only because she is allowed to compete against women with much lower levels of testosterone than she has.