Hi, pjz99:-)

"Shrink-wrapping" is a technique to fit a clothing to a figure it wasn't intended for. (Not neccesarily the best technique, but one of them..)

Try the following:
Load Judy. Load one of the P5's kiddies clothing. Create a key-frame at around frame 20 for Judy.
Reset to frame 1 and scale Judy (mainly in X & Y) so that she fits within the clothing (no poke-through). Doesn't matter if the  result looks ridiculous - you may even have to apply extra scaling to individual parts, just get everything inside the clothing at frame 1.
Ensure that the cloth is not parented.

Set drape frames to 0.
(It's probably best to use the anim editor to set all frames to linear, or use break spline in the "posed" image to avoid interpolation overruns..)

Run the sim, and watch how the figure, as it resizes to its proper proportions, "pushes" out the cloth. (You may need kill the elasticity if there's thin straps around).

Now return to frame 1 and parent the cloth to the figure. Delete the original sim and run a new one. Watch the difference...

(I hope there's a difference 'cos otherwise I've been missing something spectacularly...)

Cheers,
Diolma