Changing your difficulty to something higher will yield more XP and Influence due to more enemies/higher level enemies. However, the drop rate is the same no matter what level the enemies are, so Recipes and Salvage will still drop at the normal rate. But if you set the difficulty to something like x4 players, you will get more chances at getting drops from enemies, because there are more mobs to defeat. Level is irrelevant.
If you are the leader of a team, your settings will affect your missions if you choose to do them. If you do another player's missions, his difficulty settings will affect the mission, and not yours.
As of now, Task Forces and Trials have their difficulties locked at +1 level, with the spawns reacting to the number of players on a team. The leader's settings will have no effect on the Task Force's difficulty.
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Now, keep in mind that rewards are not guaranteed, even with higher settings. I've run multiple (as in 12 in a row) RWZ missions from Borea with "+2 level, count as 8 heroes, yes I want Bosses" (I can't quite handle +4 level on my tanker yet), and those Rikti have been darn stingy with recipes and salvage drops.
You have more chances to get drops, but you can still have dry spells.
If I'm not mistaken, the only thing that really affects drop rate is the rank of the enemies you're fighting. In other words, bosses are more likely to drop something than minions. But of course they also take longer to defeat.
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Quote:
Correct.|
Originally Posted by Master_Armantus
If I'm not mistaken, the only thing that really affects drop rate is the rank of the enemies you're fighting. In other words, bosses are more likely to drop something than minions. But of course they also take longer to defeat.
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Of course, "more foes=more rolls of the Random Number Generator" as well.
For each character, find a balance of what settings work best for you.
I favor characters with AoE's, so increasing the number of foes works best.
With strong characters that are more Single-Target focused, hordes of low-rank, equal-level critters would be a waste of End for the XP gained, and take forever.
So I would focus on smaller spawn sizes, but bump up the level until the XP gain was good, but not so high that it took too much time for any one defeat.
Quote:
That's the important part. Lieutenants have a higher chance-to-drop than minions, bosses higher still.|
Originally Posted by Master_Armantus
If I'm not mistaken, the only thing that really affects drop rate is the rank of the enemies you're fighting. In other words, bosses are more likely to drop something than minions. But of course they also take longer to defeat.
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The relative level of the foe is irrelevant as long as they con green or better. While grey conning foes can still give xp and prestige (down to -2 or -3 depending on their rank), greys don't give drops. Ever. Those who dispute that need to provide a screen capture as proof, which has yet to happen whenever this comes up.
Also the type of recipe drop depends on rank. Minions can drop Pool E and Bosses can drop Pool C+D; while all ranks can drop Pool A.
Underlings, pets, and spawned entities (portals and death shaman's zombies, e.g.) never give drops to prevent them from being farmed.
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Good answers people thanks 
Thelonious Monk
Couple of difficulty questions:
Does changing your difficulty setting change the rewards you earn in terms of inf gained, recipe drops etc?
If I am on a higher difficulty setting than my team mates in a PUG, does that affect the setting of the team, especially during TFs etc.
I've had a look around but not having a great deal of success so some clarification would be welcome, thanks.
Thelonious Monk