I am not ignoring it, I am explaining it.
It is mefurash in the Gemara in Kesubos 72a-b that Covering Hair is d’oraisa. It is also mefurash in the Gemara in Kesubos 72a-b that covering arms is Daas Yehudis, i.e. the tznius minhagim of B’nos Yisroel. It is also clear from the Gemara that Daas Yehudis is not d’oraisa.
R’Moshe is not arguing on a mefurashe Gemara. Rather he is saying that regarding the halacha of saying krias shema in front of erva, the hanacha rishona would be that hair would be mutar. However, because there is a posuk that requires a portion of the hair to be covered, that portion becomes a mokom mechusa and is m’meila erva.
If it had not been for the Gemara in Brochos 24a (that says “saar b’isha erva), hair would not have been considered erva for krias shema even if it was normally covered because I would have thought that only basar could be erva. Kamashma lan the posuk in the Shir Hashirim which shows that saar could be erva.
The issue of davening in front something uncovered is separate from the issue of walking around with something uncovered. With regard to the former, hair is more meikel. With regard to the latter hair is much more chamur.