I'm in a wedding this June. It's not the biggest reason I actually stuck with the weight loss this time around, but it was definitely a motivating factor.
I completely hear you on the arms! My arms have always been horrible - fat, of course, but I have very bad stretch marks that still look awful, even though they're the faded silvery color they get when they're old.
I've been using hand weights and body weight exercises since last March. I realize it's not the same as lifting heavy, but I have noticed some differences. My shoulders and upper back are starting to look good.
My arms are still a disappointment. I have pretty good biceps and triceps (for me), I think - unfortunately they are still covered in some fat and lots of mushy skin. But I'm still glad I've been working out!
IMO, yeah, you might stand out more wearing the jacket, if you're the only one. But if it makes you more comfortable than do that. Although, in general, I don't think our flaws are as noticeable to others as they are to ourselves.
(Of course, I'm personally still praying that my friend doesn't pick out sleeveless dresses for her wedding!

)