thats unbelievable. if thats all true about armor, im not so sad that Volonazra basically weres tissue paper for armor. Clothe caster damage reduction is near nonexistent. (IRC ,my AC at 36 is >300) My alts are pretty low level still so i cant share any game experience, but im pretty sure AC does matter.
According to the WoW vault, armor reduces damage using the following algorithm:
Damage Reduction = (.3*(Armor Class-1)/(10*Level+89))
if you visit http://wowvault.ign.com there is a calculator to use.
WoW game mechanics work using slight variance and marginal factors. Not knowing exact numbers of it all i cant give specifics. However, that is why such things like talents,race abilities, etc are seemingly teenytiny percentages.
As for the drops topic, yeah its strange. As a mmorpg veteran, im just used to it. I have always liked the idea that what ever a npc/mob had i should be able to take. For example, if i slay some warrior who had a sword,shield,full set or armor, clothes under that armor, money, tickets to the ball, etc it should be up for the taking.