To examine via reductio ad absurdum, we could make the same argument as is made against keikogi against suwari waza or against wrist grabs. That is, Ueshiba practiced what was in his daily life. He wore Japanese clothes because he wore them in his regular life. He did suwari waza because he sat in seiza in his regular life. He practiced wrist grabs because he grew up in a time when people were still familiar with and owned traditional weapons. Ergo, we should practice aikido in sweatpants, out of chairs, and against sucker punches. Etc. But if you start removing all these elements, you just end up with people practicing a type of gymnastics rather than a budo.
Actually, Daito ryu was not extremely popular at the turn of the 20th century because it involved cultural elements that were commonplace at the time at all. It was popular because it gave students at that time the feeling that they were, in fact, participating in bygone traditions and culture of the preceding era.
So yeah, I think Ueshiba was in fact studying / attempting to emulate a culture that was not entirely his own. So for those of you who want to try to follow in his footsteps, maybe you should consider that!