When it comes to PvP, damage reduction and +% damage is based on Morale. Protect is useless when it comes to taking damage in PvP. It doesn't lower the damage taken at all in PvP since Defense and Magic Defense do not work in PvP. I do the same damage to paladins with sword oath on as I do to everyone else, and they have the most defense and magic defense in the game, this proves the fact that it doesn't work in PvP.

That being said, Protect is still useful in PvP. People have abilities that dispel your buffs, so Protect acts as a blanket for the more important buffs, such as Regen and Galvanize.