I don't feel like this is an accurate representation of the situation or my motivation or desires as I have presented them. I can only assume I have not been clear in that case. At the risk of sounding like a broken record:
I am asking for is some thoughts on what kinds of tools a GM can employ to encourage players viewing and then presenting their characters in a more viscerally realistic fashion. Some folks have been very helpful, and I have enjoyed most of the discussion. The question of whether mechanical incentives are more worthwhile than in-fiction ones is an interesting one with no clearly superior answer.
I think you've arrived at looking for a solution before you've identified the problem. The problem isn't 'my players aren't playing their PCs as if they are "real" people' where "real" means acting in specific ways that you think they should. It's actually "what is my game's incentive structure, and how does that encourage play?"
I think, if you'll look, that you may be running a game with a reasonable amount of difficulty and with relatively low resource flow to the PCs. This means they don't get treasure as often as they want to be confident in their ability to overcome presented challenges, and so they are acting in ways to minimize outflow of treasure because that's the game -- get enough treasure to get the gear to be able to overcome the challenges. I futher think that you, based on some statement earlier in the thread, have many ways you attempt to separate PCs from treasure through costs for things, like baths and inns. So, again, you're disincentivizing this behavior. This reinforces and you end up with PCs that camp in the woods outside of town because they want to minimize their interaction with the treasure suck of the town outside of the gear merchants and possibly the occasional quest giver.
If you modify your incentive structure such that the cost of gearing after a certain tier is social approval of the town, then you make being clean and engaging socially with the townsfolk (and patronizing their businesses) a step in the path to getting more gear. You might also need to slightly bump up treasure accumulation or reduce costs for inns and baths and clothing.
I'm running a Sigil game right now, and I built in downtime activities to increase favor with the various factions. And I have lifestyle expenses. These two things both gate what gear levels you can buy in Sigil -- a city where everything is for sale at some price. If you want more than uncommon goods, you need a patron (a faction or other organization) and must maintain a minimum lifestyle. No purveyor of rare goods in Sigil will deal with a nobody or a street rat -- no matter how connected they appear. For that matter, you can't progress in your patron favor if you're a filthy street rat -- they have standards (although, for some, those standards are... odd). So, I've created an incentive structure where players are heavily incentivized to engage in the social aspects of the city -- to see and be seen -- because this directly affect their ability to acquire gear they want to go do the things they want to do on adventures.
What are you doing in your game to make taking a bath something the players care about? If you don't get the players interested, the PCs will continue to avoid baths (using baths generically, as it was a topic).