AAQ – yeshiva styles change quite often; in europe, only rosh yeshivos were known to wear black and white; bochurim wore lighter colored suits, and either caps or hats of various colors, all lf course conservative by today’s wacky standards. They also changed from noticeable, distinct clothing of a yeshiva man because the mussar movement held that raising up the esteem of the yeshiva bochurim in an environment that was hostile to Torah was more important. The havdala from goyim would be acheived by immersing one’s self totally in Torah and mussar, while keeping away from goyim on a practical level as well.
Bochurim in Lita usually didn’t even speak Lithuanian; my grandfather only spoke Yiddish in his town and in yeshivos that he went to, which were ponevezh and grodno.
There’s a rambam (I’ve seen it quoted in the sefer ohr gedalyahu i just can’t seem to find it) that states that talmidei chachamim and their students wear hats, so this would be the source for the poskim who say that it is still preferable to wear a hat even if halacha doesn’t require it. Additionally, our culture’s lack of a value system might invalidate the premise of the above argument; many people would not be embarrassed to stand before the president in shorts and flip flops in our twisted society.
Re, yarmulkahs and working – yekkies didn’t used to wear them when they would work. The reason for this has been a point of contention, with some attributing it to anti semtism, and others to a lechatchila, but most acquiesced to rav moshe’s psak that nowadays one must wear a yarmulkah to show that he is an observant Jew, even according to the poskim who hold that it’s not normally a chiyuv. I have a relationship with a board member of KAJ who does not wear a yarmulkah, but puts it on inbetween customers! If I understood it correctly, rav breur seemed to hold that it was bedavka, to show a havdalah bein kodesh lechol.
Some sefardim seem to not have worn yarmulkas in the middle east, including Syria – I saw a teshuva once from rabbi kassin, the chief rabbi of the new york Syrian community, defending the practice. I don’t know how long this practice dates back to, or what the circumstances were thereof.
There are individuals who have received heterim for not wearing a yarmulkah, such as steven hill, an actor on a major television show who became a full baal teshuva. Such circumstances are very unique and require a psak; it’s not the sort of thing that can be decided by one’s self. As a general rule, however, rav moshe’s psak was almost entirely accepted, as it should be.