Since items have random stats it is hard to say which is always the best. Having said that...
The dragon set items are good.
The ring you get in Verdistis from the soldier you healed is good.
The dagger you steal from the mage's shop in Ars is good.
Silver Armor --good.
Boots of the Vampire might be the best.
The Bow of Hitner or whatever it is called that you get as a quest reward is not always as good as a bow you can buy.
The question is not, Can they reason? nor, Can they talk? but, Can they suffer?
~Jeremy Bentham
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