The short jacket was chiefly because of the change of dress in the surrounding goyishe communities. However it should be noted that the litvishe yidden didn’t need as many havdalos from goyim in terms of their dress, because they lived in jewish towns, spoke yiddish, spent the whole day working among yidden and learning, and had almost nothing to do with the goyim.
Rav shach said that a long jacket is a mayloh and that a chasidishe bochur should not stop wearing it in order to find a shidduch. He may stop once he’s married, but doing something which in any way shape or form is a step down is out of the bounds of hishtadlus.
Litvishe gedolim, especially the chazon ish, pushed for distinct dress when the frummer yidden had to content with zionist neighbors in Israel and frei/goyim in America.
But for chasidim it was a shtarker inyan either way, to go out of their way to dress different in as many ways as possible.
M’Ikar hadin, Halacha requires only a small shinui (maharik 88, brought in rema)
Re, payos; there was a gezerah from goyim against having payos. The divrei chaim held it was yehereg velo yaavor, like arkasa d’mesani, while the litvishe mostly held it was not. A notable exception was the netziv, who was moser nefesh to keep his payos long.
That’s where the “behind the ears” look originated. Some litvishe discarded long payos altogether, including some gedolei olam like reb chatzkel, who kept two days of yom kippur in kobe, davened the whole day and learned the whole night, for 2 days…a malaach elokim.