This could work. My problem with the current armor rule is that most armor (in fact, in Stormbringer, all except one) are expressed as 1Dx-1, which means the possibility of 0 (Zero) protection. Combined with the major wound rule (standard in BRP with the variable armor rule, that means that even with a fairly ordinary damage roll and a standard damage bonus (+1D4 is average), a character is dead or unusable in 1 hit. This is what occurred to me several times.
In addition, I agree with Atgxtg, the average value of the variable armor is below the value of the equivalent armor in fixed value, as the damage value is the same. This devaluate the armors and his proposal at least solve those problems. If a plate armor had a non zero min value (let's say half the average value), an average value equal to the fixed value, and a max value equal to 150% of the average, I would be perfectly happy with it. But not with current rule.