Situation outfits were a good idea but, with the random way the 'ai' chooses outfits, it was never going to work. I would suggest getting rid of them entirely but, I have an additional suggestion.
Why not create predetermined outfits, along the lines of the styled outfits, for townies to wear during certain situations? Would we end up with a lot of townies dressed exactly the same? Sure. But we would also not have townies wandering around in utterly mismatched outfits that make zero sense.
Or, you know, you could get rid of situation outfits in a patch and just let sims wear their everyday clothing.
Edit: I do use mods to disable them but, a lot of people don't want to use mods in their game this would solve the problem for them, too.
moxiegraphix on Origin