For me it depends on the situation. If someone was thinking of buying a new dress that didn't suit them, or have their hair cut in a way that looked awful, and asked me what I thought, I would tell them before they spent their money. If they asked after they'd spent £££ on the dress, or after the hair had been cut and dyed, I would be more tactful.
If someone already felt bad about something she'd done, I would try not to make her feel worse, but if I really felt that whatever it was was dreadful and she was planning to do it again I would probably suggest that it was a bad idea.
I think there is often a fine line between 'blunt' and rude, however (and I'm not saying that you are on the wrong side of it, M0nica - it's just that my post happens to follow yours .
I have a friend who tells people that they 'look a lot better than last time I saw you', or that they 'look really tired', which is just unnecessary, IMO. Similarly, commenting on people's weight is unkind, unless you know that they are trying to lose or gain it.
Sometimes people have spent ages convincing themselves that they look ok (maybe after an illness or an upsetting event) and the last thing they need is to be told that they don't. IT can shatter confidence for no good reason.