I understand wanting proper attire for cycling, I just don't get the shirts with the sponsors and such. What you said can more or less apply to most sports/exercise. I see joggers all the time in running attire, but they don't dress like they're running in the Olympics with shirts that represent their country and a number on their back, that's all I'm getting at.
Well, some of these guys may actually race professionally. I'm sure there are some who don't and just like the way those jerseys look or they just want to support a team they like.
I used to work with a guy who raced at the cat 1/cat 2 level. He rode with the Swamis club here in San Diego and did some of the local races with them too so he always wore the blue Swamis kit. I've gone on rides down the coast with friends and hopped on the wheel of some of these teams as they train, usually it is 3-4 guys or maybe a couple more. It is very common to see professional cyclists training around here.
I have a couple jerseys from rides I've done. One of them is from the Amtrak century ride. I really like the graphics of the jersey which is one of the reasons I bought it. It looks pretty cool, with a Salvador Dali theme. The prior year's jersey looked like ass so I didn't buy it that year.
I also have some plain jerseys that I wear. The more expensive kit jerseys are usually better made and more comfortable. Plus bike shirts have pockets for putting keys, cell phone, ID, gel shots etc. The clothing is actually very functional.