There's a lot of surface froth, not without real consequences, including the occasional arrest of Muslims for alleged illicit sex (private, but there's a dual legal system, Muslims falling under both, so that if the couple is mixed, the Muslim gets charged, but not the non-Muslim!), kissing in public (happened recently on the steps of the KL Twin Towers), etc. but on the whole, people pretty much do as they've always done. And this applies to the more provincial areas as well including in Kota Baru, the capital of the PAS-ruled state.
On the whole, I much doubt you would notice any massive difference in public behaviour and dress in KL or any of the larger towns and what you might see in US cities, other than, perhaps, kissing in public -- but that's as much to do with local cultures as with any legislative restrictions -- and that the majority of Muslim women wear a head covering (no face covering, though occasionally you might see someone dressed thus, but have to be careful since we now have many tourists from the Middle East), a dress mode that started back in the late seventies, although that can go with jeans and t-shirt. So on the street, away from the 'dissidents', you have motorcycle gangs of workers and more lumpen types taking over some central city streets for late night races, on the one hand, and expatriates and the rich with their sarong party girls on the other, with the in-between youth, in the majority Malay, hanging out at the central square leading to periodic outcries by authority about immorality, etc. And you have almost the range of KL hanging around on the park side of the KL Twin Towers, the better off at the Starbucks and like (where a cup of coffee costs the equivalent of almost USD2), and the not so well off on the steps, and around the fountains, while just inside the entrance on that side you have the Versace outlet!
What we do have are severe restrictions on political demonstrations and political gatherings (including indoor ones) -- any assembly of more than 5 can be an illegal assembly (a law inherited from the colonial period) unless sanctioned by the police. And we of course have a law of (indefinite) preventive detention, something that was taking quite a beating in recent times from local and international pressure until the war on terrorism.
Also, theatre performances have to get clearance -- submit script for approval, needed for licence to perform. So last year, the Vagina Monologues was proscribed. Just recently, a satire company was banned from further performances for a satire that had quite a few racial barbs (quite par for the course here; we need to poke more fun at ourselves), generated a lot of public outrage, and a more intelligence municipal chief lifted the ban.
Dunno if this answers your query. Perhaps a better way of conveying the picture is to say that if you think of Singapore is free, then, yes, KL and pretty much most of Malaysia is as free, perhaps even freer -- e.g., I suspect you will come across many more transvestites and transexuals in KL than in contemporary Singapore.
By the way, the state of Kelantan, currently under the Islamic Party, is one of the very few states in the country which has had electoral changes of government. From 1959 to 1977 it was under the Islamic Party, then from 1977 to 1990 it was under the National Front, then back again. The winning party has usually won with about 55% of the popular vote. There's a hard core of something like 40% support on either side. Kelantan is a complex state. The markets in Kota Baru remain heavily dominated by women, as they have always been. One of the most popular open air night eateries is operated largely by women -- the men at the site are usually selling casettes and cd's. I possess a couple of music casettes issued about ten years ago (when the Islamic Party had been back in power for 4 years), by a then popular local female artiste singing in the local dialect (which is quite distinct) with pretty hilarious and raunchy songs, some of which would make even 'western' feminists proud.
kjk