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To a certain extent it may be favored towards lower levels. Like, a lower level has more enemies that are a higher level than them, and if loot is distributed by level, then by logic, a level forty fighting a level fifty enemy will get slightly better loot than a level fifty fighting a level fifty, simply by difference of levels. I'm not sure if that is the actual case, but if it is, then yes, loot is slightly unfair.
Other than that, its what Hooky said. Luck of the draw.
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