In Wind in the Willows, Mister Toad wears a waistcoat. Mister Toad lives in the UK. In the US, there is no such thing as a waistcoat. What Mister Toad wears is called a vest. In the UK, a vest is an undergarment worn under a shirt. In the US, this garment is called an undershirt. In the UK, there is no such thing as an undershirt. Right?
It's no wonder that in my trip to London I didn't caught half of what those Brits were saying. And don't get me started about the Scots, laddies.
I’d say you were right about modern colloquial usage, Father Steve – it’s not an obvious choice. But OED2 traces its history as apparently quite an old form, quoting Hexham from 1648 and Emerson from 1856 ('Older than all epics and histories, which clothe a nation, this undershirt sits close to the body.' It also draws attention to the NFris onnersjürt, Da. underskjorte, and Sw. -skjorta.) for comparison.
“When we Americans are through with the English language,” says Mr. Dooley, “it will look as if it had been run over by a musical comedy.”
~Finley Peter Dunn.
Right on, Mav. There is apparently also some authority for calling the thing worn under chain mail an undershirt but I have not tracked this down.