Let's get two things out of the way. Sylvia Scarlett is not as bad as its reputation. And Sylvia Scarlett is not as good as its cult fans think.
The film seems transgressive ... Hepburn plays a woman who disguises herself as a young man. The plot explanation is unimportant ... the plot is mostly pretty bad, jumping around to no apparent reason, with people acting in bizarre ways that don't always match with the characters we see. The plot opens a lot of possibilities, and Hepburn-as-a-boy looks terrific. But the transgressive moments depend on what we know (that Hepburn is a woman pretending to be a man), not on what the people in the movie know. So, when she reveals herself to have been a woman all along, everyone thinks it's a great trick, everyone immediately accepts her as female (lots of binary thinking here), and everyone moves on as if the gender switch had never happened. We're left with an iconic look ... Hepburn as boy ... but not much else.
To the extent Sylvia Scarlett is a screwball comedy, it's not very funny or even very screwy. As a melodrama, it's not particularly interesting. Without Hepburn's performance in the role, no one would be watching Sylvia Scarlett today. Which is unfair, like saying without Sam Spade, no one would be watching The Maltese Falcon. Sylvia Scarlett is a curio, worth seeing once, and as I said at the start, it's not that bad. But neither is it that good.