To be fair, I am very involved raising my three-year-old, but I am lucky if I can tell his pajamas from his proper clothes, and as often as not fail to dress him in an outfit his mother aproves of. :)
Do you also buy the clothes? Being involved from the buying point helps a lot to understand the logic of it all IMO. I had the same pb with the different baby creams, and had to choose one in the shop to really get what is used for what.
Eh, don't feel bad. If they're not denim or button down there's really no difference in kids' day-clothes vs. their pajamas. "Convention over configuration" I think we tend to call it in our industry :).