Stevens' Fifty States project (of which 2005's Come On Feel The Illinoise! was the second instalment) now seems to be permanently parked. If this 2009 interview is to be believed he was never that serious about it anyway.
His Fifty States Project, which he announced in 2003 as an epic song cycle about every American state, hasn't quite got off the ground. It began with an album about Michigan, then came Illinois, but there it stopped. "I have no qualms about admitting it was a promotional gimmick," he laughs.There is a non-state-related new album, Carrie & Lowell, out now. Generally well received but I haven't got round to sampling it yet.
Back to the original song: The Dress Looks Nice On You features on Stevens' 2004 album Seven Swans, an album awash with religious and indeed explicitly Christian themes. That it's still so great despite all that is a testament (YSWIDT) to the quality of the songs. Here's The Dress Looks Nice On You in concert - the clip doesn't specifically identify when & where it's from, but similar clips are supposedly from Austin City Limits in 2006, which sounds plausible.