It lets you change their outfits even if they aren't comfortable being seen naked/in their underwear. IIRC even Jean complies with that (if you can catch her in private to begin with that is...)
Not sure whether it's bugged or not but if you play dress-up for a while you can also get them to show more than they normally would. Doing so seemed to count as the "I'm fine with this" unlock and granted some points without losing Love so if that is intentional it's the fastest/easiest way of making them stay naked for a while.
There is another (probably unrelated) inconsistency where stripping off clothes piece by piece has lower requirements than the "birthday suit" option, and saving the naked state as an "outfit" seems to have lower requirements to wear than the direct route too. Combined with the screen "exploit" you might be able to make the girls run around naked pretty early on.