Arai full face Quantum II, Icon Daytona leather jacket, Joe Rocket Gloves and ballistic nylon padded pants, Alpinestar waterproof boots. I ride in San Francisco on #$%*ty pothole pocked pavement, and my seven mile commute sure feels like a warzone. That's my set up for commuting to work, but if I'm going out around town, I skip the Rocket pants, and wear some Thor knee/shin guards under a pair of jeans; it's amazing how much more casual it feels compared to the Rocket pants. I see some pretty ballsy riders in the city though, riding on 100+ HP sportbikes in a t-shirt, shorts and flip flops...
For me, I may not love wearing those padded, bulky pants, but I know they'll save me months of recovery time in the hospital if I'm lucky enough to survive a crash.
Risk Management -- it's the name of the game folks.