New Recommended Gear Feature Incorrect

[Nutz]

I do believe this is by design rather than a bug. At higher levels the recommended gear feature will always prefer the highest item level (the patch notes expressed as much) regardless of materia or even innate bonuses being higher on a lower item level item. It will also prefer a HQ item over a normal item.

In general this will work to pick the best items since XIV's gear itemisation usually features a steady climb in the same stats congruent with item level -- higher item level, higher important stats. It can misfire sometimes though, especially in instances like you're pointing out, where gear obtained from dungeons is a bit better than crafted gear from around the same level even if the dungeon gear has lower equip requirements.

A smarter system would be nice, but I get the feeling that they intentionally didn't get too detailed with it.