Fitting clothing to a morphed up figure is always a challenge.  All clothing made are made to fit the default figure.  As soon as you change the figure's shape, you've essentailly created a figure that the clothing isn't made for. 

There are 3 types of clothing:

Dynamic:  This is clothing that you use inside the Cloth room. It takes longer to work with and there is a bit of a learning curve, but it's not too bad, but the results are more appealing in that the clothing actually looks more natural instead of "posed and stiff". Also, you will have more success in extreme poses (legs not perpendicula to the body, or sitting, or kneeling) for clothing, especially dresses and skirts with dynamic clothing.

Confroming- Non Morphing:  This is clothing that you conform to a figure. The clothing is made to fit the base figure.  If you change the shape of the figure you will also have to refit the clothing, which isn't always easy if there aren't any corresponding body morphs in the clothing, and sometimes impossible.  Plus posing a character in positions where they are not nearly upright is difficult.  But many prefer this type of clothing over dynamic.

Conforming-Morphing: This is the same as conforming-non morphing, only there are morph dials that you can turn that have corresponding body morphs for easier fitting.  This is the preferred type of conforming clothing because it's easier to fit, but also has it's limitations.

There are programs that can help fit clothing from one figure to another, or even from the same figure to one that has been "morphed up" using their morph packages.

1. The Tailor, which you can add corresponding body morphs to the clothing. It can be bought here:
   http://www.daz3d.com/shop.php?op=itemdetails&item=677

2. Wardrobe Wizard (I use this one and it's great). It can be purchased from PhilC's site here:
   http://www.philc.net/WardrobeWizard.htm

However, I think it's on sale at Content Paradise at the moment.  Here is a post I made recently talking about Wardrobe Wizard:
http://www.renderosity.com/mod/forumpro/showthread.php?thread_id=2706148&page=1#message_3034703

3. Clothes Converter, which can be bought here:
   http://www.daz3d.com/shop.php?op=itemdetails&item=3069&cat=131

4. Magnets which has a learning curve and requires loads of practice. But there are tutorials out there. There are also some programs in the MP and I saw another one recently, that use magnets to help fit the clothing to the figure, or to other figures.

Here are some links to some magnet tutorials:

http://www.philc.net/magTut1.swf
http://www.planet-3d.com/tutorials/basicmags/
http://drgeep.com/p4/m1/m1.htm
http://drgeep.com/p4/m2/m2.htm
http://drgeep.com/p4/m3/m3.htm
http://drgeep.com/p4/m4/m4.htm

"It is good to see ourselves as others see us. Try as we may, we are never
able to know ourselves fully as we are, especially the evil side of us.
This we can do only if we are not angry with our critics but will take in good
heart whatever they might have to say." - Ghandi