My parents were pretty laid back and never gave me much grief. But I was always the jeans and t-shirt kind of girl, but I did have some interesting wardrobe choices when the situation called for it.
I don't have my own children, but, as a woman who was once a young woman in her teens, as long as she is comfortable and it doesn't get her in trouble in school with the stupid dress codes, go for it. I could say, "Oh, be modest, wear this, wear that..." but a woman can and SHOULD always feel confident about her body and in her clothing choices. If it is a bit too sexualized or revealing, it's not my place to judge. You guys are still her parents and will always have the final say. Let her experiment and find a style she likes, and be supportive.
In the end, it was my school that bothered me more about a tank top than my parents ever did. We lived in Florida, and they didn't allow spaghetti straps. WTF?