Alright so lets see that you have a simple sword and the other guy has a 47 dmg sword. They are both at the same level. The guy with the 47 dmg sword kills the other person 3 hits while the other person hitted that person 10 times. The problem is that the improved weapons are too powerful that the battle system is very flawed. Its because the damage that the IWD scroll adds (+5 per improvement). I should suggest that it should +2 damage per improvement. Its not just about the weapons they have but its the battles. They end up quickly in 3 hits that it doesnt give a chance.
The Speed in Battles:
This is a big difference in the other problem I said. Many people are so fast that it takes forever to end a battle. Because when they are really fast its really hard to hit each other. I suggest that you should make a skill called 'Ready Weapon'. It decreases your speed but it increases your damage. That should fix the problem.