NPCs randomly wear any armor and carry any weapon at or below their tier's level (with a marked preference for the better ones.)
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I got a little fed up with seeing all the bandits with the same equipment after a certain level. Looks like there is someone issuing uniforms to all of them... "Well done, mate! You managed to survive till level 20. Here's your daedric set. Break a leg!" No bad-off bandits that can afford just an iron cuirass and a steel sword even at level twenty-five, maybe with some nice (looted, of course) ebony boots and orcish greaves?