Loh Shinoo es Malbooshum?

At our Seder table on Pesach night my wife asks me " Chazal tell us that the Jews were on such a high level that they kept the jewish dress and the jewish language but on the other hand still sunk to the lowest level possible existing in the human condition which Chazal call the forty nine gates of Tumah. How can those two conditions exist in the same person at the same time?"

The answer is obvious just look around you.

The truth of the matter is that without doing much research regarding this issue, it seems pretty obvious that generally throughout history jews dressed pretty much in dress that was common to the indiginous populations outside of what would be considered Avodah Zara or Ervah.

The Gemarah in Avodah Zara 58b states "Rabbi Yochanan the son of Orzah and Rabbi Yosi the son of Nahorahai were sitting together and drinking wine, that man (the waiter) came by and asked to pour them another cup, after they raised their cups they realized that (the waiter) was a gentile. At this point we must stop and ask ourselves "how is it that those Amoraim saw a jew with a streimel and bekacha and thought that he was a gentile?