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Alchemy Damage Reduction
Why does it keep getting smaller per rank o-o
I guess the confusion here is that the reduction applies to your own damage output rather than the damage dealt to you by your enemies.
Oh, I did :P
Guard Cylinder < Regular Cylinder. In terms of "damage" (not literally damage)
Thus, if you're using a guard cylinder to use alchemy, you will be doing less damage than you would with a normal cylinder. That "less damage" is the reduced through Guard Cylinder Mastery. As you rank Guard Cylinder Mastery, the damage reduction is lowered, thus doing more damage when you attack.
It's basically a penalty so players are persuaded to use Cylinder + Guard Cylinder combo rather than Weapon + Guard Cylinder.
Players using C+GC will receive full damage damage when using alchemy, but less melee damage.
Players using W+GC will receive a "damage penalty", but do more/less melee damage depending on the dualed weapon.