Am I horrible for looking ?

There's nothing wrong with looking, or even staring, so stop feeling bad. What would have been wrong is if you could tell she was getting uncomfortable but kept looking anyway. Just remember to read the room and be mindful of the signals people are sending out.

Noticing what is being advertised is only creepy in the minds of the seriously unhinged.

if she didn't want the attention she would have worn a bra. she probably smiled after you passed by. 

But she should be used to your dirty leers in the morning, Step Daddy!