The strange metal collar does not activate for the first time. According to the wiki, once equipped it should change into the Slinky black omnisuit.
It does absolutely nothing.
Perhaps a work around, maybe make the mystery collar a consumable, that leaves the actual suit in your inventory...or add a button on the collar that you have to press once its equipped, or at the very least just sell the omnisuit as a completed Item, at least until a code could be made for it...at least for now.