Agreed. I can understand in an RPG-style game or PvP-centric game where you may not want people tricking others into thinking they're wearing something other than what they are. (Although even progression MMORPG's now have 'transmog' / cosmetic options, despite that.) But in Ylands, it seems like more of a creative / cooperative exploration/PvE-survival game, no real reason it would be problematic.
I'm all in favor of letting people visibly show...
Not to bump an old thread, but my point is actually that the game could use another more updated tutorial on events/triggers (and your video in the original post is missing, so I wasn't able to learn from that.)
I had a bunch of questions (actually posted it first over on the Steam forum, might as well just link that). It'd be good if you gave us more guides/tutorials/help on how to create stuff like this, because that results in creating content for other players...