With regard to the personal loot setting:
It was always my impression that using the personal loot setting was to avoid drama in pugs and not as an actual gearing strategy for a raiding guild. But since you suggested it, I spent some time looking into it.
So far, I'm not convinced it would be a good option, for the following reasons: I was not able to determine how does the amount of gear that drops for personal loot compared to the amount that drops if we set it to master looter. But, if we assume that it is equal, with personal loot we will run into an issue where some of those gear drops will go to a person that already has that piece of gear. When we use master looter getting a piece for a second (and sometimes third or fourth) time usually doesn't matter because there are usually multiple people that need a piece. Even if we still theoretically get the same number of drops using both loots settings, when we factor in the possibility for repeats going to the same person, would be actually be getting less loot? I think we would. Correct me if I'm wrong here, but with personal loot you can't trade the piece to anyone else right? So if we get the same number of pieces with both loot systems, we would in theory actually get less usable loot with the personal loot system because we don't get to distribute it among the 15ish people we brought with us? That doesn't seem like a good idea.
Also, RNG is nice in that it doesn't hurt anyone's feelings but is fully relying on RNG really the best way to gear up a raid? For example, simply using /roll to distribute gear in a raid is generally accepted to be a poor method as it relies only on RNG. So often you end up with some people having lots of loot and some people having none. Would you not get the same result using the personal loot option?
Also do we get to DE personal loot? I don't think we could unless it's unneeded loot that an enchanter got. With normal loot systems we can get enchanting mats for the GB from extra loot. This is REALLY important for a guild that provides free enchants. Also extra patterns (once all members with that profession have them) and BoE gear (once no one else needs it) can be sold to provide funds for the GB.
Raiding is a team endeavor, our number 1 concern is distributing the loot in a way that is best for the progression of the raid team, while still being as fair as possible. So far, I am unconvinced that using the person loot option achieves this, nor does it provide any benefit to the team in the form of extra mats and funds to support the raid.
With regard to the opportunity for misuse of the proposed loot system:
We have tried out a bunch of loot systems over the years including straight rolling, EPGP, giving gear to whoever it is the highest upgrade for, a kinda sorta loot council, and more recently SK. All loot systems have their benefits and drawbacks. So far we found that SK was easy to use and distributed gear in a relatively fair way.
I get what you are saying with regard to the chance of malicious use though, it makes a lot of sense with the example you gave. The only issue we ran into with SK last expansion was people not wanting to give up their spot for a minor upgrade (which is kinda the issue in your example only it is someone lower on the list gaming the system). This resulted many minor upgrades being trashed. This is not ok because a bunch of minor upgrades handed out to a bunch of people will help the raid team more than people holding out for that one special piece that they want. Basically it comes down to people placing more value on their own personal character rather than doing what is beneficial for the team as a whole. And obviously we care about our own toons the most, but raiding is a team endeavor. It didn't happen often, but it did happen, and that's not cool. I would like to think that we could all put the needs of the team ahead of our own wants, but sometimes that special, shinny piece of loot is tempting. The changes we discussed this time around are aimed at addressing this issue.
In the example you gave, this is how I would see it going: If a piece of loot drops and it is an upgrade for someone, someone is going to get it, because that helps the raid. If the wrists are an upgrade for Ben and not Don, then Ben gets them and is suicided. If the wrists are an upgrade for Don but not for Ben, then Don gets them and is suicided. If the wrists are an upgrade for both Ben and Don, then Ben will get them because he is at the top of the list, and be suicided. If a piece of gear is truly itemized so poorly for a certain class/spec that it is not an upgrade, then you won't be forced to take it. So if it's an ilvl upgrade for both Ben and Don but the itemization is so bad that it is worse than what Ben is wearing but better than what Don is wearing, then Don gets it. If it's worse than what they both are wearing, then it will be trashed, go to os, whatever.
If we operate under the intention of doing what is best for the raid team, we can't trash a piece of gear that is an upgrade for someone because they want to hold out for some other piece of gear that might not ever even drop. We realize that ilvl is not the be all and end all and that's why the decision is ultimately up to the lootmaster. Maybe Glenn can chime in here since that it almost always going to be him? :P
Anyway, if anyone has any ideas, suggestions, etc, on how to improve loot distribution, I (and probably Glenn and Ben lol) are happy to hear them, keeping in mind that the ultimate goal is to help the raid team progress, and the loot system should support that.