The reason was to prevent accidental fire catching on the loose clothing when doing homey etc. Also, temple priest had the same fire hazard problem, thus puncha gacham (5 folds) was a convenient way to tuck the edges. I was told once by an old man that the longer the cloth, it is better to use half of that when it is cold and the other half will be on your waist. May be the 9 yards saris were also recommended for the same purpose. Also in case of fire, it is easy to drop the pancha gacham by just a pull and in the dark night one one cares.
There is no rule that you can not wear it if you are not married. Sanyasis wear that too. But strong naalu muzham (4 muzham or hand long) Dothi is more convenient to wear but a belt may be necessary. Many teachers use to wear Panchagacham in olden days and some of them were not even married. They also use Talipakkuu or head gear as a desi method of wearing a hard hat worn by British Official. As of now, wear what you get and GOD will not punish you. Did Shiva use Panchagacham, killed silk worms to spin silk dhoti?. Hisorically and even now in some African countries, they wear nothing or only leaves at the hip. In our climate country any cotton dress is fine. Also, white cloth drive away mosquito as white color radiates heat away from the body and dark colors absorbs. In north India many wear Panchagacham and they will say that it is a tradition.