I worked at an office that did once - and I HATED it! I love potlucks, parties, etc., but coming to work in costumes (when you have no customers or children you are trying to impress) seems absurd to me. I'd much rather have casual days, etc. and a few basic social gatherings, raffles, etc.
On Halloween the crazy ladies in my department (we had no men) decided to dress in leotards, tights, with clear bags of coloured ballons so we would all be jelly beans. Some of these ladies were not thin, trust me the leotards were a bad idea. I was the only one out of 15 that didn't participate and I still don't regret it. Everone ran around like idiots all day (probably because they couldn't sit down) and then spent the rest of the week desperately trying to meet their productivity goals. As far as I'm concerned the day would have been better spent if they'd just given everyone the afternoon off.