"Check Outfits" simply checks for too many of a particular type of outfit. It does not check the validity of the outfits themselves.

Off-hand I can't think of an alarm action in Overwatch that would affect outfits, however it could be indirectly linked to something.

If it is not Overwatch, is there anything else that fires at that time?

I've narrowed it down to a male dog, just trying to figure out exactly which male dog it is.

Don't recall anything else firing a 3am in my suite.

Well I've tracked it down to one of three male dogs.

Because of this, I am satisfied enough to continue as is. So I am unable to pinpoint:

Whether this issue still occurs without Overwatch installed.
Whether this issue still occurs with certain Overwatch settings disabled.
What exactly it is about that dog that caused the issue.

Should I ever experience this again, I might look into more detail. As it is, I just hope my investigations will help someone else someday, because this issue has stumped me for months now. Though it seems it is too rare an event for my investigation to be of much use, you never know.

I had it again. I seem to be cursed...

I tried disabling different settings in Overwatch, to no avail. Then I even uninstalled Overwatch and no change. So it doesn't seem related to Overwatch, which is odd as it seems to happen at about that time of the night.

I deleted all horses.. no result. Deleted all dogs again, no result. Deleted all cats and had a much better result: there was still a town wide event, but every sim recovered their outfit correctly apart from one.

I had a feeling it might be a pregnant female cat that gave birth just before the event. I went back to the save before the event, and ended her pregnancy. After that, the event didn't occur.

So still no real idea what causes it exactly, but yet again it seemed to be one particular animal.

Hmm... Suckage.

Stumbled across this thread whilst looking for another old one of mine, so I just wanted to take a moment to update this.

I've not had this event since I started being more careful with my pet breeding.

I now carefully check each newborn animal to ensure they don't have too many coat layers.

It seems after many generations, animal sims can end up with dozens and dozens of coat layers and many of them aren't even on the animal itself.

Keeping the coat layers to a small number (I work on around 12 max) seems to ensure the town wide outfit reinherit event doesn't occur.

REVIEW FOR DOCUMENTATION, do not know if it still happens as Frimlin described, but if some other simmer do want to breed pets, this is a valid thread to read upon.