That formula doesn't decrease (edit: or increase) your damage based on enemy levels, it just makes you do more in a natural progression of ability that is gained with levels. It wrecks enemies that are low level because they have lower stats when compared to mobs of your own level or higher. There is no part of that particular formula that increases damage based on your level vs the mob level (that's what dlvl is). This weapon formula does more to mobs that are lower because their stats won't keep up enough to mitigate the damage.

Tl-Dr: Try again.