This look was one of two looks Melissa put down the runway. This particular look was her "homework assignment." It was shipped ahead of Project Runway's taping and was meant to represent who she is as a designer. I thought it was great that she would choose a look that was tsnius to represent herself. Her second look, which she only had a day to create, was not tsnius, but she only had one day to make the second garment, so I'll let that slide.
I personally love this look. I think the skirt of the dress is very flattering and the vest adds great texture and an interesting neckline. I think it would look great in a variety of colors, especially a more equestrian color palate of a deep red dress and a dark camel or dark brown vest. I could see other more playful color combinations looking great as well.
In the interest of full disclosure on the blog, I learned based on the Tim Gunn critique of Melissa on Project Runway's site that the dress' neckline is asymmetrical and not tsnius on its own. It's either the same as or similar to this dress on her website. However, the vest was never taken off on the runway (or at least the TV-edited runway), so I'm going on the assumption the dress with vest is a complete look and meant to be worn together.