Though Cloth clothing should be flexible in terms of who can wear them unless it is form fitting (which could be considered Tailored)
Metal not as much and should take into account layers.
Yup, cloth should definitely give a little more leeway than plate when undersize, and be less awkward when oversize. Material properties (and
the new "structural elasticity" flag) should handle that. I made a
Suggestions thread about tailoring last year (and apparently you made one too, earlier on), although that was more about meeting the fortress's demand for clothing than about clothes that fit well.
Dude. Shortswords, when a human adventurer shows up at an abandoned fortress, show up as daggers apperently. Some dude had an artifact. Yes he did, yes-sir-e-bob.
I would chalk that up to narrative license, given how rigidly separated the weapon types are in DF.
The issue with simply changing what weapons are due to sizes OTHER then style differences is the handle.
A Giant Knife may be smaller then a Great Sword... But it would be impossible to hold because of the size of the grasper.
Yeah, the grasp is kind of analogous to the neck hole of a shirt or something... it could check your grasp size vs. the "preferred size" of a particular knife's handle to determine whether you can wield it or not (assuming you're strong enough to lift it). There could be an uncomfortable-but-not-impossible range where you get some combat penalties. Checking grasp sizes vs. the size of the grasped item/BP would also be important for wrestling, of course.