This will vary enormously by field, and countersignaling is a thing. All bankers wear suits. If you see someone wearing a scruffy ill fitting suit maybe they’re just incapable of buying a well fitting suit and keeping it in good nick or maybe they are awesome and know they’re awesome and know everybody else knows it so they can get away with it. You saw the same thing at IBM when they started going casual. If everyone else is wearing a suit, is normal, and there’s one person with blue hair and full sleeve tattoos they’re getting special dispensation because they’re awesome. But the blue hair didn’t make them awesome.

This could be because of (anti-)selection bias. If you have a test of skill that can be overridden because someone happens to be very attractive, than the only really incompetent people who will make it past the skill filter are those who are really attractive. If both the skill filter and the attractiveness filter are very selective, then incompetent people will be overrepresented among attractive people by the inverse of the selectivity factor of the skill filter.

Highly dependent on the profession. In programming, I agree with you. In my experience, there's a nearly perfect inverse correlation between how much they care about their looks and how talented they seem. But not in other fields, seemingly. I basically stopped hiring slovenly people in many things because of terrible experiences (real estate agents, plumber, house inspector). I guess the difference are things that can be done solely with the brain vs things that require some amount of physical activity. We programmers have it easy in that respect.

I imagine it's probably fairly dependent on the expectations of the people you interact with. If there's no or very little expectation to dress professionally, those doing so might be doing it because they want to, or are trying to compensate for something else, or are trying to signal some other group (e.g. management). If the expectation of everyone is that you will put effort into it (even if it's because it's self-perpetuating by them making negative assumptions about you if you don't), then it can actually mean people that don't either are trying to make a statement, or can't make that happen, which can signal something all its own.

Me as well - those who overinvest (as opposed to adequately invest) in their appearance seem to underinvest in their competence. Not always true, but a correlation.

Perhaps that's why it was brief :-)

Collider, happens with lots of good things that correlate. To put it rather bluntly, if they were both competent and sharply dressed, they'd have a better job.