what others have said here pretty much mirrors my opinion of it.
I know talking about other games is kind of a no no, but Aion (and other games) have costumes, but they are stat-less. players have the options to wear them as "town gear", or to "remodel" their main armor to put the costume skin onto it (which destroys the original remodel piece in the process). Remodels can later be removed, or have another remodel skinned onto the original armor in its place, but the original costume can never be recovered once this is done.
This system doesn't break or alter the function of real armor, but allows players to make their toons look unique, rather than eventually having everyone running around in the same set of armor, looking like clones.
THIS is what I envisioned when I heard Shaiya was getting costumes, and this (or something similar) is how Shaiya should have implemented them.