Armor and HP scale exponentially, but there is no strict requirement to have every piece of equipment at max level. It is harder with slightly under-level gear, but not impossible.
Rarities work this way:
There are 3 rarities at any given level. At level 9 all of them improve by one step (uncommon becomes rare, rare becomes epic, epic becomes legendary). At level 16 they improve further, removing rare and adding divine rarity. I think there is an exception that epic cannot be found before level 5.
Funnily that means that lv8 epic gear has actually more stats than lv9 epic gear (except armor ofc). But no one cares, since you now have access to legendary.
About what stats you can get, I would need to check the modding editor.
