The difference between 32.5% with resists and soft cap without

Keep in mind that this is partly a "depends who is asking and what they plan to fight" question. Most of the data on Resistance and Defense comes from people playing melee characters, which makes some assumptions that aren't entirely applicable to characters who usually deal with pot shots.

-Defense isn't the only source of increased damage. Enemies with +ToHit can can dish it as well. Devouring Earth are one of the worst for characters who can't quickly deal with their +ToHit placeables.

On squishies without mezz protection, Defense is often extremely important because the mezz shuts off Resistance armor for its duration anyway. One hit and it's curtains.

But Resistance has some weird properties too. In a case where an enemy can hit you hard enough to one shot you, can't use this ability that often (e.g. because you mezz it after the shot), but Resistance would reduce the damage to allow you to survive 2 hits instead of 1, Resistance is much safer. With Defense you will die one out every 20 hits. Particularly noticeable with certain AVs vs a squishy who plans to run from them for most of the fight but might get caught once or twice.

TLDR "it's complicated." Personally I prefer layered defenses although there are cases to be made based on specific situations.


Addendum: With Barrier in play now, 40% Defense isn't a bad number to aim for either. The long lasting version of Barrier gives more or less perma 5% defense at its lowest point. And 40 + 5 + 12.5 (from a purple insp) = 57.5, which I believe is just 1.5 below the incarnate soft cap for most enemies.