The final preposition is the dispositive one.
deck out in
deck out with
in is used with attire and things worn
with is used with ornaments, flowers, baubles, etc
P.S. The verb deck out (in) is informal; it is somewhat reductive, diminishing the importance of the attendant pomp to some degree, though not to the point of biting sarcasm:
The queen was decked out in her tiara and necklace.
The prom-goers were decked out in their rented gowns and tuxes.
The chieftain was decked out in brightly colored feathers and a necklace of human teeth.
P.P.S. And it's not that there is an absolute divide. If the preposition with is used of brooches and rings, that usage turns the bearer, subtly, into a decorated object, an arrangement.
NOTE: Just as the items a room is decked out with can be taken down and removed, the items a person is decked out in are also temporary. We would not say that a person was decked out in or with tattoos.