What is the CPSIA?

No, if your product is still intended for use primarily for children under 12 your product still falls under the CPSIA. In addition, by marketing and selling the clothes as a toy, what once may have only needed lead testing would now need phthalate testing as well.
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Many people believe that some phthalates may have adverse effects on the reproductive and developmental potential of infants and children who are exposed to them.
The research on topic, however, shows mixed results.  Different phthalates have different effects on the body, and there may be other complicating factors as well.
Years ago CPSC investigated whether phthalates pose [...]

The procedure for phthalate testing involves grinding the item being tested into a fine powder. The powder is then dissolved in chemicals and analyzed for phthalate content.

There is currently a stay until February 2010 on the testing and certification requirements, but once that stay is over the lead and phthalate testing for CPSIA compliance must be done by a CPSC-approved third party laboratory.  A list of these laboratories can be found here.
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