The western denim shirts are designed to be rugged work wear. Worn outside to protect the wearer while doing dirty farm chores and sweaty ranch work. These were not intended to be fashion wear. The sleeves are looser so they breathe and can be rolled up. It's a very well made, practical shirt.
You're right about that. It would be kind of strange having it all tight and fitted everywhere. The shirt you sold me is beautiful by the way!