I fucking hate that so much, sometimes "because it's cool/sexy" is a good enough answer, it's fantasy for fucks sake, who cares if it's "realistic"?
SJWs not only hate sex appeal but they also have this weird desire to bring everything down to a banal reality instead of just allowing things to be fun and cool.
In the case of Soul Calibur, first of all this is a world where people hit each with blades but it doesn't cut them, but you're telling me the fact that a lady fights in dominatrix gear is what shatters the realism for you?
And secondly, with a character like Ivy, it's much like Conan The Barbarian fighting dudes in a loin cloth or Rambo gunning down dudes while shirtless, fighting while wearing little clothing is badass, Ivy sending the message of "I'm such a badass I don't need big bulky armor, I can beat you in a thong" is empowering, it's badass, it's not a sign of weakness.
In fact this goes back to the whole femme fatale archetype, once upon a time a female character being flagrantly sexual was a sign of strength, not weakness, it implied danger, not vulnerability.
It's such fucking bullshit that people have gotten it in their heads that sexy always = sexist or sexy always = weakness.