I don't mind the shorts because you can always wear a very large size to make them decent (I think I have XL though I normally wear M to L for shorts). I'm not sure what diminutive race of humanoid they used to size the new uniform, but whoever they were, they were related to pygmies.
The worst part about the PT uniform is two-fold: 1) It's WHITE inside the jacket. Um, we PT on the grass quite often and/or sweat, which is likely to stain a nice, white fabric. Brilliant choice. 2) Those damn sweatpants are like "gangsta" style fit, and they "swoosh" every time you take a step, whether running or walking. I hate them so much I just froze my legs when I was in Baghdad going to the shower because we either had to wear the PT uniform or DCUs all the time.
I firmly believe the AF uniform board is composed of functional idiots. Actually, I can be almost positive that it's composed of pilots and aircrew who don't wear most of the stuff and just find the most outrageous designs to laugh at all of us groundlings. I hate to admit it, but the Army does much better in all aspects of uniform changes (well, apart from that stupid decision about the beret and then sourcing them to China initially!). The Marine Corps also has the process down quite well.
As for the OP, you should have dressed that cocky Airman down, taken down his supervisor's name, and then followed up with said supervisor to ensure that the Airman at least received verbal counseling from his chain of command. Not to be blunt (well, ok to be blunt), but you are an NCO and that's your mandate. Yes, he screwed up, but so did you in letting it go.