How is it that many Teimanim wear long peyos (simanim) similar to many Chasidim, considering that their culture has been mostly isolated from Ashkenazi Europe? Do any historical sources tell us when and why their custom originated?
HaRav Yoseph Qafih zt"l writes in his book Halikhoth Teman that it was a custom primarily of kohanim who came to Yemen in antiquity.
And the idea that Yemenite Jewry was isolated from the Jewish world and its literature throughout the ages is a myth. Adan was a port city and other ports on the coast of Yemen were a frequent stop for those sailing around Africa. They had all types of sepharim from various Jewish communities world-wide, including the Hasidic communities of Europe, and those in Germany. Another similar myth, i.e. that the Qehiloth Teman followed the Rambam simply because they did not know about the Shulhan `Arukh, is also completely false and contradicts the wealth of historical sources and rabbinic correspondence and responsa - some dating back to the times of the Geonim - that indicate that the Yemenites were very aware of the Jewish world around them and in the greater Diaspora.
Their historical isolation was from the Muslim population within their own country and not from Judaism at large. So, in relation to your question: scholarly evidence points to peyoth (or simanim, as they are referred to in the Yemenite community) being a continuation of ancient custom hinted at in other ancient archaeology of Egypt and the Levant. In fact, Yehezqel HaNavi (also a kohen) refers to being lifted by the "ssissith roshi" which seems to also infer to this practice being originally a midath hasiduth in the priestly families of old.
My own opinion as to the sources of these rumors and theories is that many in the Haredi community cannot fathom anyone choosing to follow the Rambam or other authorities after the publication of the Shulhan`Arukh and the popularization of the teachings of Yisshaq Luria. However, they chose him and follow him due to his greatness in halakhah and purity of reasoning.
I hope that this helps. Kol tuv.
It seems from the Tshuvos HaRambam 244 that one does not need to grow their payos long and in fact the Rambam did not grow his long.However in this tshuvah it seems the masses had such an idea of growing them long. http://www.hebrewbooks.org/pdfpager.aspx?req=1731&st=&pgnum=170
The Ben Ish Chai in his drashos on parshas zachor brings a proof from Mordichai that he had long payos see his Toras Lshima siman 389(If I rem correctly) which talks about growing long payos ss well.