I believe v1.36 covers the latest dlc clothes, but v1.34 is completely playable with no loss of functionality.
While there are costumes, there aren't transformations per se. Example, a worm monster attacks your nipples, deals tease damage and increases your tease weakness going forward. You can wear a regular shirt to block some attacks to the nips, but the area can cause negative status effects for being overheated from too much clothes.
Less transformations and more "race to win before becoming weakened to tease damage too much to actually win." Losing and restarting a NG+ is expected a couple times.