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IMO the best uses of oversized sleeves in character design are either to make a character look cuter by covering their hands completely (because hands are a symbol of action, and covering them implies inaction and helplessness), or to make them look sneaky, like they got something to hide (be it a weapon in those sleeves or just something other characters and/or the audience doesn't know) by covering only part of their hands up to the knuckles.
These are not mutually exclusive though.
