I think you are just going to need some time to lose your "fat" mentality. It takes a while.

I still see my old size 20 khaki pants wearing body-even though I now wear a 14 pants, and even a 12 in tops.
If you are not a "trendsetter" type of dresser, and are into more comfortable clothing rather than fashion clothing-I would suggest looking in sporting goods type stores, or the exercise clothing section at places like Target. (They have cute Mossimo stuff) You may find that rather than a plain old t-shirt and jeans, that you would look good in (and be comfortable to boot) in a pair of athletic styled pants, maybe with a matching tank. They have some really cute ones that color coordinate, and you could use them for running errands and working out, but look a little more "pulled together".
If you love jeans-you can easily make jeans look nicer as well. Nix the regular styled t-shirt for a more stylish "fitted" t-shirt and wear some cute flip flop sandals with them (Target/Wal-Mart/Payless/Old Navy have them cheap in a zillion colors) that match. Very comfortable, but cuter than a baggier regular styled tee.
Another way to mke jeans look better is with black. Wear a nice black top with them, and a nice pair of black dressier sandals or slides and you will look great.