That's what people usually mean when they talk about the clitoris, you are right.¹ But we are talking about a language vocable in a dictionary here, not about colloquial language. Sign language is not something like an auxiliary language, but a natural one. This is why we can expect from a sign language dictionary that it uses the precise terms. My wife is working as a sign language interpreter and she very often has to prepare vocabulary before a job, then she uses these sites as a dictionary. Common jobs are medical consultations, but also medical conferences are possible. Then she needs precise terms. She doesn't speak ASL so I can't ask her about this specific sign, it could be that it can be used for both meanings.

Please don't get me wrong, I don't want to win an argument here. I just want to give another perspective!

¹I guess people mean this because the term is older than the knowledge about the anatomy of what it describes. People often just don't know. This is something that can change.