One of the first things I did on my server was assign level scaled global loot and for the past two years I've periodically attempted to improve it.
First I made an item values table and a scoring script that grabs everything from the items table that's equipable and scores it based on stats. I gave every possible item stat a multiplier and in later iterations even broke down spells by effect to try to determine the 'value' of a proc or focus. A good scoring module alone can be a bit of a task if you want to be thorough.
Once I had values written for all the items I was interested in setting up as loot (about 34,000) I started messing with formulas for distributing them across a level range from 1-75, defaulting any higher level mobs to the 75 table. Across the various iterations I've had models that spread out the desired quality range across all levels, or use a fixed increment, and finally I've gotten around to giving NPC's scores of their own and transcending level altogether so that a boss has boss loot, etc.
It breaks down at high levels because the natural quality distribution is lop-sided. In the early game you have all these varied natural drops but as gear starts to get higher end you're usually dealing with class armor sets and epics, which typically can't fill a single table of 100 items.
Using a simplified scoring model might actually give you better, even if substantially smaller, results. It depends on what your final goal is. For me, I just wanted folks to be able to play anywhere in the world and still get meaningful gear without drops being too generic.
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