What it meant to the writer of the lines I don't know, but my guess is like Charley's and Rowan's: since she's going around the world to beg for bread , she'll need a petticoat that won't look dingy. But perhaps the writer had nothing spevial in mind - just needed to round out the stanza ("Hmmmm. 'I'll beg for bread...they'll wish me dead'...what rhymes with dead?")

What one makes of it today is an individual matter. If you think you know and pass it on, you're a "folklore source." If you know you don't know, and admit it, you're an academic. (Well, one sort of academic, anyway.)

When it comes to interpreting folk lyrics, as Rod Serling used to say, "the only boundary is that of imagination."