To fool the audience into thinking the horror is over. It lets them take their hair down, take off their pants, change into their "favorite" sleep shirt and block out the world with Diane, taking a fake breather before having to survive the climax of the film. + The jersey dress is a reddish orange, a take charge, in your face, kind of color, which the audience will be easy to follow during Diane's ordeals (a.k.a. swimming around with skeletons in their half installed in-ground pool and not letting her children get sucked back into their closet.)
How does Diane's clothing fit?
The fit of her clothing is over sized and slouchy, hanging loosely off her frame, making Diane appear smaller (weaker) then she really is. Never underestimate a mother on a mission.
How is Diane styled?
Diane is anti-styled, she's styled effortlessly. She's very simple with no make-up, no shoes, and no pants. She's not glamorous. She doesn't plan on impressing or seeing anyone else besides her family for the day. She has changed out of her "day" clothes and is now relaxing in her "private" clothing in her "private" bedroom space. She's lounging comfortably behind closed doors.
Where Diane goes in her clothing & how it changes how we view it?
Diane looks comfortable in her bedroom, yet vulnerable in the next scene as she's being dragged around its ceiling by the poltergeist. Her look changes due to her situation and her locations going from private to public spaces. Her "private" attire looks inappropriate outside her house, for example not wearing any pants in public, especially at the end when she is at the Holiday Inn.
Overall, putting Diane in a garment the audience knows, wears, or can recognize themselves really grounds her character and her look. It makes her poltergeist situation more real life and tangible, placing them or their moms in Diane's pant less predicament. When Diane is thrown into public areas in her pant less look, we feel exposed for her. We feel out of place. We want to stay hidden in the comforts of her house with her, yet her house has become a house of horrors and SHE MUST GET OUT!
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