Gotcha: Since the official forums are dying from irresponsiveness and time-outs I'll try asking the GoG people:

I've never really payed any attention to Armor Penetration, since it didn't really matter in the Arizona part of the game.
I just made sure to have the guns with the highest damage, who usually have an increased Armor Penetration as well.

I've reached California though, and after visiting a gun vendor, question marks started popping up.

My guess is that a 4 Armour Penetration weapon would negate any armour up to 4 points, doing full damage.
But how high is the penalty if, for example, my gun has an Armour Penetration of 4 and the enemy has an armour rating of 5?

I tried searching the official forums, but like I said, I am constantly getting time-outs there for the past days.

See this post's attachment:
Is there any reason why I would want to buy the G3 while my M16's damage is so much higher? The M16 only has an Armour Penetration of 4, while the G3 has 6, but the G3 has a pathetic damage compared to the M16. Wouldn't it be smarter to keep the M16, since the extra damage would offset loss in Armour Penetration I'd think.

Any number crunchers out there? :D