With this model, DR is still DR no matter what name you call it, even if it's collective DR instead of spread out.
There should be plenty of balanced monsters for you to fight, and if your DM really wants to be a **** then he'll just have the Dragon aim his breath weapon at the parties wizard and 1-shot him anyway.
I think that DR is just to hard to get and to expensive at higher levels. Plus, most of it comes in the form of x/magic; just change it all to x/- and you'll get alot more use out of it.
In my own armor fix I make it easier to get decent (I think) amounts of DR at higher levels; if you haven't read the update already go check it out.
Ah ok, I wasn't sure what you meant by "fix". Cause if you are going for the realism angle, then your fighter is gonna be lugging a portable forge around with him or hitting up the wizard for Mend spells :PLike I mentioned in my edit above, I'm not totally sold on the degradation mechanic myself. It was put out as an option if you want to allow the eventual wearing down of armor, so it's nearly impossible to be completely immune, while still giving a fair amount of protection. (Consider +5 Full Plate at level 20. You start with 130 blocked per round, second round it's 120, third it's 110, and so on. Even with the armor getting worn down each round, the armor overall blocked 910 hp damage, which is a huge boon. But combat probably shouldn't last that long, and it would only matter if you don't get the few minutes to fix the armor before moving on to a new combat.