Does Level Effect Mob Drops?

Title pretty much says it all. It seems like my level effects the frequency of drops, primarily when I kill lower level enemies.

 

I don’t think it does. My level 100 charater (no loot bonus) still gets all the rotten flesh.

It does affect xp. If you kill an enemy with level above or below you, for every level it’s away from you, you lose 3% xp
So if you kill something 10 levels above or below you, you lose 30% of the potential xp

 

Actually, I think it affect the number of armour and weapons dropped by mobs. I never found my lvl 100 character get ANY drops other than the altar ones from ToL.