To lessen the confusion of an item having the same icon with another, it would be very beneficial to all of us if you delete all the lowbie unnecessary gear from the server. Since pretty much every item can be bought from an npc, I guest rupiah is the only exception to have on the loot table.
Just for kicks, why don't you set all the skill levels to default K5, then you can tweak it from there if you find imbalance?