Depends, most videogame worlds are far enough removed from reality for me to not really give a shit. Unless it was something truly outrageous like throwing the ninja bikini stripper squad into Hearts of Iron or STALKER.
Personally I reckon that games, especially MMO/RPG types should come with a sensible and scanty option for each type of armour, you could turn them on or off for each gender, so you could have dudes in banana hammocks and women wearing half a blacksmith's, everyone in pieces of string, everyone wearing twice their weight in iron etc as you see fit. Choices! Choices for everyone!
Personally I reckon that games, especially MMO/RPG types should come with a sensible and scanty option for each type of armour, you could turn them on or off for each gender, so you could have dudes in banana hammocks and women wearing half a blacksmith's, everyone in pieces of string, everyone wearing twice their weight in iron etc as you see fit. Choices! Choices for everyone!