Ah, that kind of challenge. I genuinely think Renewal went overboard on the damage reduction (it's another part of why I dislike it), but I also think RO mob design from the Einbroch update onwards has been straying from "fair" into the unsavory territory of "terrible".
To me the sweet spot is oldschool/pre-trans (can you tell yet it was my favorite era in RO?), where things hit hard but you could actually survive them with gear. An ungeared Knight would take upwards of 500 damage from High Orcs, and when fighting Orc Hero he basically had to pray he didn't choose to use Earth Attack and gib him instantly. Even if he didn't, that's 2k+ damage a pop. It hurts. Same Knight with a +7 WoE set, Thara and Poo Poo would take maybe 100 damage from a High Orc attack, Orc Hero would do at most 500 regular damage and Earth Attack could tag him for 6k (or he could use Dokebi for a much more manageable 4k).
Nowadays, in pre-Renewal RO, you have amazing design like Orc Hero doing over 60k damage Spiral Pierces to the exact same Knight with the exact same gear. And no, tanks haven't gone up in quality from those days - you get a +10% HP bonus from Tidal+Wool, +25% HP from Trans, perhaps +1% HP from Green Ferus, and damage cut in half from Assumptio. So that's what, triple the effective HP? While Orc Hero does literally ten times the damage?
And then they went and applied that to REGULAR MOBS, which leads to wonderful dungeons like Thor's Volcano and Bio 3 where everything one-shots you. And started a silly "boss damage arms race" that ended in MVPs where you have to literally abuse bugs to take down without bringing your entire 36 man guild along for the ride.
Anyway, about gearing, I feel it goes like this - in pre-Trans, gear is a nice thing to have. In pre-Renewal, gear is a requirement. In Renewal, gear is an afterthought.
EDIT : Priests haven't outhealed anything (or done much of anything, really) since Transclasses and the introduction of Fury/Power Up in Einbroch. No, not even in Renewal : Heal was nerfed to the ground, Archbishops in general are useless and Coluceo Heal is TERRIBLE.