We paid for the dresses and the GM shirts, only because they were paying to come to the wedding and I knew everyone's financial situation.
The dresses were about $110 each. I bought beaded flip flops for $6 on clearance and jewelry for $40 and included both in their gift bags.
The GM shirts worked out to be about $15 each because I got them on a super sale, had a coupon, and used my store credit card that I turned right around and paid. They were originally $65 each!
I think it is a nice gesture if you can afford to do it. Because we had 3 on each side it was feasible for us.
If you do ask them to pay for their own, then I wouldn't choose a $300 designer dress.
If you let them choose their own, I would write a nice card explaining the prefered style - strapless, knee-length, etc. You should also include a fabric swatch (es) as there are so many different shades of aqua.