The screencap below shows the final results.  If everything is correctly done, your dynamic clothing should fit when its morph is applied.

Tips:  Do not crowd your workspace; the less clutter, the less distraction.  I have noticed that your custom character is not in a zero position on the stage, which can cause problems when running a Cloth Simulation.  You also seem to have morphs applied that complicate simulation and proper fit.  Those may need to be addressed separately.