Yes -- that's exactly how, and only for the inventory screen (to give a sort of at-a-glance idea of how different armor compares in overall effectiveness) All the actual combat math uses the numbers from the object editor.

In the inventory screen, armor is shown with an armor class AC value. I was curious how the number shown here is calculated. For example, in the Ultima game the plate gauntlets absorb 6 points of damage 5% of the time according to the object settings, but the AC is shown in the inventory as 0.

The plate armor, by contrast, absorbs 7 points at a 75% rate, and has an AC value displayed as 5.

I think I may have answered my own question here... is it

AC = (points of damage absorbed) * (percentile), rounded down?