Unless it has a purpose, you're right, it's completely unnesecary.
I heard someone defend Mileena's attire in MK9 saying that she probably flaunts her body to try and make up for having that hideous maw.
Okay, fair enough, but why do ALL OF THE FEMALE CHARACTERS DRESS THE SAME WAY?! Their faces aren't deformed or anything. They did make Shao Kahn to be somewhat of a pervert in MK9, probably to make you (somehow) hate him more than you already do. I was thinking that perhaps he forced the women in his realm to dress like that, but then why do Kitana and Jade picke even skimpier outfits once they join the good side? And what about Sonya? She's not under Kahn's rule, she just dresses like that for no reason! Maybe it's something about little resistance on the body so the characters can preform their acrobatic attacks, but there's a difference between dressing stylishly like an acrobat and dressing like a hooker.
It's been proven that there can be plenty of completely nessecary and well dressed women in games with Jade from Beyond Good and Evil, Heather from Silent Hill 3, and Alyx Vance from Half Life 2. These characters dress like normal people and actually develop.
However, being an unbiased person, I must add something to the argument: these scantily clad female characters usually appear in fighting games (Street Fighter, Mortal Kombat, SoulCalibur, etc.), and fighting games are meant to be fun and not much else. I guess the question then should be "Why not?" instead of "Why?". For example, Mortal Kombat is meant to be an over the top fighting game, and the female characters only add to how over the top it is. We've already got rage filled ninja spectres fighting against cryomancer warriors in epic battles to the death, we've already got a guy with a gun (that does hilariously low damage), we've got skull emperors and sorcerers who can become other fighters, what's wrong with having some hypersexualized females in the mix?