I could write an essay on why the Warband system is superior, but lets just do an example.
In competitive, you have 1000 gold to start with. A standard Sarranid archer build would look like this
The scimitar is dropped for an infantry who gives a shield to the archer in return.
BUT!
The sarranid helmet isnt optimal, because 1 headshot and you're dead. Instead of picking this helmet, you could change your build to something like this
The more expensive helmet will save you from pretty much any headshot, including from a crossbow (depending on range and a certain amount of randomness) so if you're fighting lets say Swadia or Rhodok, and you know they have a talented head hunter, you decide to pick the more expensive helmet to save your life, and use the normal free sword for yourself instead.
Some infantries prefer the axe over the scimitar, so the drops can become abit more complicated based on your players style, and who theyre fighting against.
Example 1 of 40000 as to why Warbands system was better.