"Cleavage should never be blamed for creating a hostile or sexually charged enviroment."
I agree with Myra, you need a reality check.
Sure, all women have boobs. Most women cover them, modestly, while at work. Some wear clothing to show as much as legally possible. That creates a distracting atmosphere, even if no male ever makes a single comment. The boss has the right to ask employees not to wear sexually revealing clothing to work. This applies to male and female employees. Remember, my company's dress code was prompted by a man wearing a sleeveless shirt to work. It was distracting.
"And I don't understand why it wouldn't be appropriate for a woman to wear a sleeveless shirt if her underarms weren't shaved?"
Because many people consider underarm hair to be unattractive. In our society, it is generally normal for women to shave underarm hair and men to not shave underarm hair. Thus, we require men to wear shirts with sleeves. A man with a sleeveless shirt in the workplace, even with shaved underarms, would be weird enough to be distracting.
Because it is culturally normal for women to shave underarm hair, we permit sleeveless shirts during the hot summer months on the condition the woman shave underarm hair.
If she doesn't want to shave underarm hair, which is her personal choice, she need not wear sleeveless tops to work. You want a special privledge? You fulfill a special condition. The bottom line is we don't want underarm hair, male nor female, visible at work.
There's nothing wrong with a dress code that differentiates between males and females, so long as there are no onerous burdens on the basis of sex. A man wearing a skirt would be sent home, for example. (We're not in Scotland, so even a male kilt would not be allowed unless the boss requested a bagpipe concert in the lobby.)
Clothing appropriate for our office makes you look like you are devoting your full attention to your job. Your clothes fit properly - not too tight and not too loose. Your clothing is modest and appropriate for your work. You are not using the workplace as a venue for attracting a mate. You are there to work, and not distract others from their work, nor offend the paying customer.
After all, in some jobs a dress code might include steel-toed shoes, for safety reasons, or a hard hat. Want the job? Want the paycheck? Wear the shoes and the hat.