If armor worked this way, then HP upgrades should be more useful than armor upgrades because (Base HP + HP upgrades) would act before (Base Armor + Armor Upgrades), making armor upgrades less worthwhile.
But in this way, armor regeneration is for free, from the % of hull. I.e. if you have hull 1000 and let's say armor == 25% of hull (too keep it more realistic), then you will regen 25% of effective hull for free. Or looking at in from different perspective - reduce the damage done to the real hull by 20%.
And, on a side note, what the hell does "Mass Reduction" do? The last Vasari armor tech, "Atomic Lattice Armor" gives an armor increase of 4.5 over the base and a Mass Reduction bonus of 4%. Does this reduce resource cost, build time, etc., or increase speed or some other weird thing.
researchModifier
modifierType "ArmorBaseAdjustment"
baseValue 0.000000
perLevelValue 0.500000
researchModifier
modifierType "MassReduction"
baseValue 0.000000
perLevelValue 0.040000
File in question is RESEARCHSUBJECT_SPEEDBOOSTARMOR