I don't provide an answer in this post. I have been having this discussion in my head and thought it would be worth posting and eliciting your thoughts as well.
There are many mitzvos in the Torah that we practice today. Each one of those mitzvos has many halachos. Each of those halachos has many elements. Suffice to say, the Orothodox Jew lives a life of incredible attention to detail on thousands of details.
One area halacha falls under the rubric of tznius. It is not clearly a mitzvah to be tzanua nor an aveira to be not tzanua. It is a violation of halacha and probably a violation of rabbinic law. Again, in this area we are greeted with many rules, details and specifics.
JewishAnswers.org was asked a long-winded question whose basic point was this:
"Why is it than that I see religious woman wearing clothing that seem at best to be just technically meeting standards of Jewish law but still in violation of the standards of modesty?"
Rebbetzin Toby Katz takes a stab at answering this question with (among a lot of other mumbo jumbo,) the expected response:
Some women think that if they are dressed within the letter of the law—elbows and knees covered, hair covered (for married women)—then “I’m alright Jack.” Sometimes it takes a wise outsider or newcomer like yourself to notice, “No, you’re not alright Jack—or Jill!”
This is an expected response because we hear about it all the time. "People are following the "rules" of tznius by covering what needs to be covered." "But they are still not really tzanua because they "miss the boat" on tznius and are still "too attracting"." You know the drill…
Here's what I have been thinking about since reading that answer on JewishAnswers.org. Is this the only place in Orthodox Judaism that halacha is not enough? For some reason we also demand that the adherent to halacha find the "spirit" of the halacha and adhere to that as well.
For example: Let's assume the spirit of the mitzvah of arba minim is achdus (we see this in Chazal, its not just new-age spirituality). Would we condemn someone who shakes the arba minim but doesn't "internalize" the "spirit" of the law? Yet that is exactly what is done with regard to tznius?
Why does tznius get that kind of treatment? Maybe it really is enough to just follow halacha? The halacha says that there are parts of the body that must be covered. That's all it says. True, it may not be very modest (in the social sense) to wear skin-tight clothing, but it is permissible in halacha.
I'm not saying that an Orthodox Jewish person would not want to dress in a modest way, rather, that in this part of Judaism, for some reason, halacha doesn't seem to be "enough".
One more thing. If you read the sources in halacha about tznius, it is all about what MEN cannot do. Men cannot read krias shema if a woman in not covered properly. A man must give his wife her kesuba, UNLESS she was an "overes al das" (with witnesses and proper warning). It doesn't say a WOMAN MUST… in any of the sources I saw. I just found that interesting in contrast to today's rhetoric of "Women must do this… Women may not do that… etc..."
Search for more information about Tznius at 4torah.com.