To be honest I'm a bit nervous about this, even though I suggested the formula myself. I worry that it will also make PV less effective against monsters, which could possibly make the game too hard, especially if a relatively high penetration parameter is chosen.
The current endgame lets you fight through a gazillion fire giants, which is the one currently existing monster that can't be damaged by non-critical hits. I think this is the main reason why armor penetration is needed in the game in its current form. We need to keep in mind that this will eventually change, as the endgame can be expected to become much more varied in the future.
Fire giants are comparable to molochs. Imagine what a game of adom would look like if level 30 to 45 had no other monsters than hordes of molochs to fight through and how this would skew game balance. Personally I feel that they should be one size smaller, which would make them colossal instead of gargantuan. They're not titans, they're regular fire giants.