I agree with Jucy in that the school needs certain limits.
We also discuss censorship. While we don't have the gang problems that many cities do, we see our share of symbols. The biggest one is the marijuana leaf. Even though I though it was cool to draw a pot leaf on my artwork when I was in high school, I don't allow my students to do it. Hypocritical? Back then I didn't have the responsibility to set a good example.
I ask them what image they want to project to other people, and we discuss what is and isn't appropriate.
As for baggy pants.......I wore polyester shirts and platform shoes back in school, so I won't lecture them on fashion. However, I do not choose to see my student's rear ends and tell them that at the beginning of the year.
If you are familiar enough with the student, you can always yank the pants up for them, although not really smart to do that in this day and age.
I catch their eye across the room and make a motion for them to pull up their pants.
However, I see a more casual attitude in the schools, and it has its pro's and con's.