CC clothing help

Hi.
You are making a dress, which should animate and morph like a dress, so all the data responsible for those things should come from a dress of the same length. You transferred it from a lingerie set instead, so the skirt behaves like legs.

Start by finding a maxis garment that is similar to what you have in mind and studying it:
1. the first thing you will notice is that none of them have deep folds like yours. There is, however, an illusion of them created with textures. The lack of these sculpted folds is the first thing that makes maxis meshes look so smooth during animation and morphing;
2. the second thing is the edge flow. If you were to quadrangulate the mesh, you'd see that the edge loops have a flow and the logic behind their placement. There are vertical edge loops along the folds. There are circular edge loops in the chest area where the breasts shrink and expand. There are edge loops in places where the body bends. Right now your dress has random topology and it makes the mesh look and behave in the "crumpled paper" manner;
3. the polycount. The maxis dress has more edge loops in places where they are needed to retain the shape or the functionality. You see more edges in the knee area where the dress bends, in the chest area where the mesh expands, in the waist area where the mesh changes the shape dramatically. Less edges in the thigh area where the mesh does none of the above. Your mesh has universal density that is unnecessarily high for the game asset yet too low to make the mesh smooth. Basically, the mesh is high poly not just "for nothing" but for worse, since it amplifies the "crumpled paper" look;

4. if you were to select each major bone from the skirt area in Weight paint mode, you'd see that the paint's fall-off is smooth. If you were to do the same with your dress, you'd see that the paint is blotchy, so the mesh does not deform smoothly. The weights should be transferred with Nearest face interpolated to avoid this;

5. the difference between how the skirt and the legs are unwrapped in uv_1 is evident here

6. see the distortion in the armpit area? Because the sleeves are loose, some areas of them are closer to the torso and receive data from it instead of arms. You'll notice that maxis always makes sleeves tight in that area
7. See how in the first pic the knit pattern is bigger on the arms? You should not scale uv islands of the same piece of clothing individually, it leads to this, it is noticeable even without a pattern.
8. should not have deleted all the legs