I don't know, I think it's different if you are applying for a job in a big corporation or for a smaller firm/startup. Bigger firms will usually have a more strict dress code (the place where I currently work short pants are frowned upon, except in case of system integrators)

In both cases I usually go for jeans/shirt combo (but not a t-shirt, bigger firms/older people find it unprofessional in my experience), but that's just me.

When people say "dress one level above the job you're applying for", I can't help to imagine what the levels are. I came up with something like this, from high to low:

- 3 piece suit

- 2 piece suit with tie

- 2 piece suit, no tie

- suit pants and dress shirt

- khaki's and dress shirt

- jeans and dress shirt

- jeans and t-shirt

- shorts and t-shirt

- stained shorts and wife beater shirt

I always wonder where the bow tie fits in though, or are they just always inappropriate?

I think he meant in general, not at the interview (though more senior people can get away with it in the interview too).