I would just use the nurbs square. One above him and the other below him. Create a garment and then start the seams. You might want to set the resolution to something higher if you want accurate deformations. But i would just try simple collision objects, say for the knee and body. You can parent them to the bones or set orients so they move accordingly.

If you want super accurate stuff,, good luck, as the calculation will kill you. Not to mention the number of times it takes to fine tune cloth.

Good Luck,
Post your scenes so that ppl can help you out. You can of course duplicate your mesh and poly reduce him and then use that for your collision object...

Ok thats all,
Kumar