Hello all this will be my first post to this forum so I hope I bring a topic not many have seen before, or if you have then I hope to at least share my thoughts lol.
Alright I can by no means say that my Pathfinder/DnD experience is anything linear, I started playing in 3.5 as a swordsage when even the DM had no idea how maneuvers worked and was getting started himself, but thought they looked cool and that I would have fun. the result is probably the most unintentionally broken but fun character I still have, and that was 4 years ago. since then I've dove deep into the rules and systems and now know them more then any of my friends and am the current DM of all but 2 of our games, however I've had a bit of a problem with one area still, and that is the loot drop.
Now I by no means never drop loot, but I'm always at a loss as to WHAT to drop, because I'm a heavy continuity person. Something isn't going to be there that wouldn't be out of place so often they are given just select amounts of treasure their meant to save most of and buy more supplies in towns. I do this because most of our members (myself included) don't really enjoy casters owning the entire game nor do we like the feel of the christmas tree, so we play only partial casters and a few more unique magic items (an example is that there is ONE pair of flying boots), so our balance point is a little low end in power scale.
One of our newer players came and asked me "Why don't you ever drop different weapons or armor? I'm using the same stuff since the beginning". This actually surprised me a lot because I'd thought he'd been upgrading it and just forgetting to tell me, and that got me thinking more about how we've handled those things, which completely explains my lack of knowing what to drop for them. Our characters use (for them) iconic equipment, if the warrior has a sword then it's one from his family, or is what he learned to use as a boy, or something very similarly meaningful and so he'd never just throw it away, instead choosing to pay and just improve it more and more, never picking up another one unless in some devastating event it was shattered.
In classic style of gaming however, swords, shields, and armor are constantly traded for another +1 and the main hitter is usually carrying at least 2 other swords of varied materials, but why do that instead of making the ones you have better? is it a matter of convenience to not need as greatly detailed histories as some characters, or is it a matter of just wanting to loot for the sake of feeling like you got a new toy?
Sorry for this wall of text, I didn't realize how much I was going to say lol.
Perhaps in the classic style of gaming, items are often upgraded linearly (+1s to weapons, cloak of resistance, ect). While these items are good mechanically, it is very fun to find goodies that have neat special abilities. Since magic items sell for half, it means that you can really draw out a story of a cool magical item with a story and unique abilities, so that it sticks with the player. Consider having certain items, as well as giving out consumables. I personally have consumables sell for much less (25%) as to encourage use and saving of these items, and I also enjoy having neat weapons or abilities, even if they're not as powerful. Gold bagging used to be more popular to bypass DR and for backups, but is less needed now (+3 weapons count as all materials except adamantine for DR), but some characters will hold on to special weapons they spent a lot of effort getting.
The main point of what I'm trying to say is, getting cool, unique items that they can use is almost always going to be more fun for the player than getting some liquidatable items.
One idea I have seen used to great effects is having items upgraded, either through a quest/ritual that is drawn out and not easy (like going to the eldest dragon of _ and forging the blade again in its fire; but the dragon wants something in return).
Oh of course the UNIQUE items are interspersed within there, I'm more refering to the idea of constantly trading off things for the next one with the bigger bonus, something I've seen a lot of people doing in their games. We limit the magic items A LOT in ours, so when they are found they are either things that make you really happy (like a cloak of resistance with history) or probably only a few of it's kind.
In most games, it is far faster to buy a new item rather than wait for an old one to be upgraded (if at all possible).
Though I am a big fan of continuity, your post had me envision Arthur putting Excalibur back in that rock while declaring that he preferred to use his own trusted sword :-)))
"My own blade hath shown me through more then i can account for..by god, it will see me through this"
I really should stop my brain from just making fictional quotes in my head when i read something cool lol
Item drops can be unique with flavor.
It sounds like you're doing something like this already. I too like to drop only weapons the monsters would actually have. My players fought a bunch of kobolds, finding a masterwork spear... sized for a kobold. No one in the party can use it, but they can keep it as a trophy or sell it or whatever.
To supplement this I often have Downtime, and in these moments I make it a point to engage my players with specific questions like what items they're looking for or what they want to improve on their PCs. I then have contacts in the town that might be able to offer something along the lines of what the player is looking for.
However if you're looking for ways to make item drops unique, look no further than Diablo II. Lets say an orc drops a masterwork axe; yawn. However he also drops a rare piece of Warpstone; a magical crystal that emits a radiation that can be subtly manipulated by master crafters and spellcasters. The axe, being masterwork, can survive this intense process and the gem can be utilized to imbue the item with some kind of upgrade - Flaming, Defending, etc. The process itself grants the device a base +1 and costs a pretty penny, but such items are always worth the investment.
Finally item drops don't always have to be weapons and armor. Give them a little forethought. Your player is compaining that he needs a new set of armor. In the next town he JUST HAPPENS to run into a rare armorer who claims to be able to make amazing scalemail armor sets using dragon hide and cold iron. The party is chasing a dragon, but he'll need other things too, like the blood of a wyvern-stung dwarf and sunlight distilled through a kobold's eye. The party has a dwarf in it.
They hunt down a local wyvern, allow the dwarf to get stung then kill the beast - they then drain a vial of the dwarf's blood and rest for a day. The next day they find a nest of kobolds, slay a powerful sorceress, and take her eye up to the hilltop aerie of the wyvern where they follow the process to distil the sunlight into six teardrops. Finally they go destroy the green dragon they've been hunting, skin it, and return to find the crafter has already started to prepare the process. Since he's got the cold-iron started and has some spells to help out, it'll only take him a day to fuse all the materials in a ritual that results in a suit of dragonscale armor +2.