Gaidax, I have to admit the idea of taking Vitality AND Armor (as appropriate) is interesting, and it lets characters of all types contribute to a fight.
The armor functions as a "buffer" to protect you from CC as well as reducing the "real" damage that you end up taking.
So if you get hit for 80 Air Damage, that'd be 40 Magic Armor, 40 Vitality you take.
However, this would require some thought about how to change a few skills like Necromancer (only triggers if you do Vitality damage) and Perseverance (for obvious reasons). You might also need to make tweaks to Hydrosophist and Geomancer as well because of how they work with Armor.
But ... I do like the idea and think its more elegant of a system than the flat "ignore all damage until the appropriate Armor type is gone" system.