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So basically you can thing of a defense of X as raising your hit points by X%. Another way to think of it is that 100 defense means you take 50% of the incoming damage.
It might not always so simple, there could be monsters that "pierce" through some or all. A very quick skim of the Monsters page on the wiki doesn't seem to show any though. https://dungeon-of-the-endless.fandom.com/wiki/Monsters
If it is true no monsters pierce armor (only effects that lower it) then you can do the math for anything giving defense and/or HP max to see which results in the higher effective HP. Actually now that I'm thinking about it I guess it depends if your defense can be reduced below zero by effects. If it can and there's no "piercing" monsters as the wiki seems to suggest then effective HP is all that matters. If defense can't be reduced below zero and there's a ton that lower defense then sometimes HP max may be better.
Honestly that formula is pretty terrible IMO. It is basically designed so that it's balanced as much as possible in as m any scenarios as possible. Which is good for a hyper competative multiplayer game or something. But roguelites and roguelikes... part of their charm is having broken runs, either hard or easy, for player power or boss power, just.. It's fun seeing them go nuts sometimes, and formulas like that (and not even showing them to you to boot) stifle that IMO.
Yes!!! It is one of my biggest pet peeves for games to not describe how damage calculations work. Some games are good about showing parts (even this is good about showing DPS automatically so you don't need to divide in your head) but it feels like so many miss the defense part of it.