I've had this issue personally due to misunderstanding between branches. Which I can completely understand that not all current service members and veterans know every branches uniform instruction. Here is where it draws the line...
I am a Air Force Vet, served 2000-2006. At the last parade I participated in, I was approached by an active Army Reserve member who flat out started yelling at me and then proceeded to try and rip my Air Assault badge off my BDUs stating that there is no way an AF member can wear Army decorations or badges.
This member was then pulled aside by a retired Army Colonel who led the parade, was ripped a new one and told that AF Instruction allows Air Force personnel to wear earned/awarded badges or decorations by other branches at their units discretion. I can understand speculation, but flat out trying to remove an article from someone based on assumption is very disrespectful. I did my time at Ft. Campbell...
Btw... this retired Army Colonel was wearing an USAF Master Pilot badge and other decorations from his USAF service before he switched branches which is allowed in AR.
On topic, honestly I'd be too upset and be better off walking away if I saw someone dressed like this.