Damage and armor are calculated like this:

Damage max-(armor/15)=actual damage.

If actual damage is less than minimum damage then minimum damage is applied.

Damage reduce from shields, skills, armors reduce the damage even lower from the min damage.

Example:

damage 500-1000

armor 15000

damage reduce 50

Effective damage is:

1000-(1500/15=1000)=0

0<500 so damage applied is 500

damage reduce is 50 so real damage is 500-50=450

So you get the message "Damage reduced from 747.653 with 64" this means that his equipment has the ability to reduce your damage for 64. He has at his items "Damage reduce" with total bonus 64. Also the 747.653 is the damage you are doing after the armor reduction.

Now about the redaction of your block:

From the manual:

- Each 10 Strength points decrease the opponent's block by 1,5 points.

this means that he reduces your block for 12,75.

also he has Darkness Curse skill that reduces your skills by 1. This reduces your shield Mastery...

I don't know your Shield Mastery level so here is the matrix...

Shield Mastery

Points 1 2 3 4 5 6 7 8 9 10

Bonus +4 +6 +8 +12 +14 +18 +20 +22 +24 +28

You lose the difference. lets say you lose 2 points.

A total reduce with 14,75 points.

And finally from this:

On January 17th, 2011, the following changes in the storyline quests will be deployed:

[...]

In the mean time other important gameplay changes will be implemented:

**1. Hit evasion and Block chances will be changed to 75% and 60%, instead of the previous 65% and 50%**.

[...]

You understand that you can't have more than 60 block.

You have 123 block... that's 123% but with "penalties" you get 123-14,75=108,25% but since the max is 60% you end up with 60.

If you were against a high strength enemy (let's say 400) without the curse you would end up with:

123-((400/10)*1.5)=63% so again 60%

but with 450 str

123-((450/10)*1.5)=55.5%.

I believe I cover your questions.