Has Naruto's less-than-stealthy costume been explained in-universe? Out-of-universe, Naruto's day-glo orange costume was chosen to make him "pop."  In-universe, it's hard to imagine a less efficient color for a ninja, especially in a wooded area.

Has there been any in-universe explanation for why Naruto wears that color, and was allowed to continue doing so even during missions?  Failing that, has the absurdity of it at least been lampshaded?
First of all, I think its obvious what Naruto's favourite colour is. From Genin to Kage, he maintains his signature orange colour. 

The poppy orange colour was not only focused to make Naruto's appearance pop to the readers/viewers. There were several other factors:


Naruto's appearance was a tribute to the Dragon Ball series by Akira Toriyama. Masashi Kishimoto (Naruto creator/mangaka) was deeply inspired by Toriyama's works. Naruto's colour scheme was designed with respect to that of Goku's.
From Naruto Wikia:


  Naruto's mother was nicknamed the "Red Hot-Blooded Habanero" while his father was famed as the "Yellow Flash". Naruto's appropriate self-styled title of "Konoha's Orange Hokage (木ノ葉のオレンジ火影, Konoha no Orenji Hokage, Literally meaning: Tree Leaves' Orange Fire Shadow)" refers to the fact that the colour orange is a mixture of red and yellow.



The fact that Naruto's signature colour is a result of the mixture of the signature colours of his parents, is a significant reason for its implementation.


Naruto's childhood was a very rocky one. The villagers used to isolate him and ignore him. Due to which, Naruto would put up acts so he would be noticed or appreciates or be cared for. The poppy orange plays a crucial role here. Combining the two logic, i.e., orange pops out and Naruto wanted to be noticed, his dress code makes sense. 


Some other factor(s):


Due to the Kyuubi being orange in colour. Kishimoto purposefully made Naruto and Kurama's colour scheme similar so they would look more related. This is something that I read a while back. It makes sense, but it's just an unsourced info. 
Here's another factor I found while going through the post, Why does Kakashi Hatake always wear a mask? (credit to @InfantPro'Aravind'):



  @user1526, adding to starPilot's, color orange signifies ENERGY, a will to be sportive and always ready .. that's the character of Naruto .. – InfantPro'Aravind' Mar 17 '13 at 13:23


As for in-universe talks about his dressing, I couldn't find any reasoning or questioning references.