I can relate to a lot of what you write, Lisa. I have a lot of clothes that serve limited purposes, and it's more likely that I will pass on clothing out of a style shift than by wearing it out. I may be multifurcated with my wardrobe, in fact. But maybe it is working for me.
I was reading Brooklyn's post with admiration, thinking, wow, I would like to achieve that kind of seamless wardrobe. And then I thought, I have made some strides in that direction, and I may actually have gone about as far as I want to. I have a few pieces of exercise clothing that can work for street wear, so that when I packed for an active-tour vacation (hiking and biking), for example, I was able to bring a top, some shorts, a jacket, and even some shoes that could multi-task as exercise and casual wear. And I have eliminated special-occasion-only wear from my wardrobe, for the most part. There are a couple of dresses that I wouldn't wear super casually, but they are things I would like to wear for a date with DH, not things I'm keeping because I think I "might need" them. I have gotten rid of all the clothes I thought I "should" have on hand, but that don't really reflect my life: a funeral dress, a long black coat, something that could pass for formal wear, etc. Being retired, I no longer have work clothes, which has enabled me to pare down to what I truly want to wear. (Though figuring that out isn't so easy, it turns out! But that's another subject.)
I have a lot of workout clothes. I like them to be extremely functional for their specific uses: cycling, swimming, Pilates, hiking, and walking. My main sport these days is bicycling, which I do outdoors, year-round. So I need and wear different layers for the many conditions I encounter. And I need a certain number of, say, wicking baselayer shirts and padded shorts to keep a manageable laundry cycle. Some of the baselayers and jackets are good for cycling, hiking, and walking. Some of the Pilates clothes go walking or hiking, too. With my cycling clothes, I'm ever mindful of visibility, so I wear a lot of high-vis colors that I would not wear in other situations. I find it kind of fun to sport a bunch of brights that I wouldn't wear otherwise.
I don't feel that my sports clothes are outside of my style, even though they may bring in some colors I wouldn't wear outside of exercise. I choose what I wear for sports with as much care as I do the outfits I wear for anything else. Among my cycling friends, I see a lot of distinct styles, even though we are all dressing for the same activity and have a lot of the same priorities. There are so many ways to assert one's style, even doing something fairly specialized like endurance road cycling.
My special-purpose exercise clothes do take up a lot of space. If I didn't have the space to store them, I would have to seriously re-think my clothing priorities. I might in fact reduce my streetwear, rather than try to make all my clothes more multi-functional.