Stick to your guns! You set the standards for your son and you need to respect those limits and he does, too.
That being said, there is nothing wrong with him working to earn extra money, as long as it doesn't mean he's getting paid to do things he is supposed to be doing anyway. A good plan (to boost his GPA as well as his bank account) Is to give him a certain amount of money (ten cents or a quarter) for each "A" he brings home on a school paper and a great amount for each "A" he brings home on his report card. This will encourage him to work harder at school - can never underestimate the value of that! It also means a rather protracted peiod while he is building up the money to buy his new duds.
On another level, you might encourage him to ask her if she would like him better if he was 'punked'. If the answer is yes, have him ask her why. Obviously, with a 12 y/o reasoning doesn't work all that well., so you just need to exercise a little more compassion and remember, at that age, kids are just starting to come into their own. They ar less a 'kid' and starting to 'feel like' an adult. (Even though it will be years before they realize just how much more they had to learn!) Keep trying to remind your son, as subtly as possible, that it's what inside that counts. That's one of those messages that won't really sink in for a few more years but, if you plant the seed now, it will grow, like all flowers and good investments, in the future.
Too bad we don't get hazard pay for good parenting, eh?