The theory says that if you dress like the other women in the environment you plan to be in, that is, if you blend in with the other women, you will lessen the chances of bringing attention to yourself, thus increasing the chances of successfully passing yourself off as a woman.
For example, if you are going grocery shopping, then jeans and a top would be your choice of apparel for blending in most places.
I have tried blending and it seems to work, but blending is boring. When I dress en femme, I want to dress EN FEMME, if you know what I mean. I dress to be noticed not to be ignored. If I wanted to be ignored, I'd dress en homme.
As Lucille Sorella wrote recently in her Feminization Secrets blog, "As a genetic woman, the last thing I want to do is blend in! I wear makeup, style my hair, and dress fashionably because I want to stand out in a crowd. I believe it’s a natural feminine desire to want to be noticed."
As a transwoman, I feel the same way.
And perchance I have to go to Stop & Shop to buy a few items while I am en femme, I just think of myself as another working girl dressed appropriately for the office, but overdressed for grocery shopping during her lunch hour or on her way home from the office.
Works for me.