You assume that the intent is to allow players to not be hit all the time. That's not true.
Let's assume that the typical high AC character's AC allows him to avoid 50% of all incoming hits. That means that, in comparison, the typical DPS character is at least ten times less survivable than the tank! Imagine how squishy barbarian, who can currently handle all the aggro in DDO, if mobs were hitting ten times harder.
That's why S&B is so weak right now. If DDO developers try to make high AC be not overkill, they'll overpower it.
PS: Once again, I don't agree with the solution found in the OP.