"My understanding of the song has always been this:
- During that time period prostitutes (or whatever you want to call them) for the most part wore some form of green on their arms, to denote their trade perhaps."

Where have you seen that? First time I've heard of it. The lowest sort of prostitutes couldn't afford anything, they solicited in the alleys. I think that a poorly dressed woman flinging herself at you in the street screaming 'reasonable rates' is a better indicator than the color green, especially after dark.
Then there were brothels and high-quality prostitutes. They had better advertising methods as well.

"About the green sleeves, I'm fascinated that the explanation I got from my mother that it was high-ranking, high class women who wore green on their sleeves, and that the poor guy couldn't have her because he was just a lower class peasant. My mother was well known for revisionist history."

Then how could he afford to lavish her with gifts like that?