They still wore the less tattered clothing to church then, didn't they?
Anyway, a lot of this simply isn't 100% accurate. Urban society existed long before industrialization, as did the merchant class, who were not nobility or gentry, and the tradesman and craftsmen who were not wealthy but certainly were not peasants.
And many of the fancy, colorful "native costumes" you see in books were, in fact, festive-occasion clothing worn by peasants.
Put another way, wearing your "Sunday best" is simply a product of secular culture. It has nothing to do with the Bible, Jesus Christ, or the Holy Spirit!
Okay, if wearing your "Sunday best" is a product of nineteenth-century secular culture, then going out of your way to wear your "Sunday worst" is a product of late twentieth-century secular culture. You know, the time when standards began to be regarded as things to be lowered, and traditions as things to be scorned...gee, if I have to choose...
Actually, I agree with you. Standards should never be lowered, and traditions should never be "scorned".
And it is also true that as a person grows in knowledge of God's character, he will tend to dress better for a worship service.
So, in summary, knowing God will change the way you dress. Changing the way you dress will, well, change the way you dress.
After we get this settled maybe we could actually talk about something important.