Most likely none, it's working as intended. The most they would do is reduce NPC repair price a bit further.

Though if they are clever, they would scrap the repair system. Instead, reduce all effectiveness of equipments to that of red gear damaged, add an "enchantment" from crafters that last for about as long as 100% durability to 33% durability which make gear back to current normal status. And then people would praise this game like it's some kinda innovations.

It's all about psychology aspect, people don't like to be "penalised", they like to think of being "rewarded".