I believe that in order to keep PvP more fair, people shouldn't be able to hoard lvl 10 best equips in game and dominate everything. Noobier items should degrade faster if used on harder ebs, and vice versa. Items should be destroyed after a certain amount of attacks/defenses/losses. You would get aqua and inferno from this, so it would be viable for people to equip crap items and farm aqua and inferno better. Stronger items would drop more aqua and inferno, but take longer to break.
I would like to add to my post. Along with item degradation, you should be able to further upgrade your equips through xp. Items gain xp based on damage dealt, not attacks, so you would see a wider variety of EB farming going on in the t5/6 players. Of course there would be no point in having item degredation AND item levels, which is why I want to further add to my post: item repairing. You can only repair with mith, the higher the enchant and the worse the damage is, the more it costs to repair (this cost scales hard, so it would be best to keep your good equips in top condition unless you are trying to destroy the item)
If you read all of it you would see that I addressed that issue. People can keep their items, they just have to maintain them, which comes with a drawback of paying in mith. It makes it so there is more use for the useless equipment everyone has laying around, and helps even out PvP so those who aren't Swiss bank thieves have a chance of warring with the big guys. I would also like to expand further on my idea. All items don't degrade whenever you use them, there is a chance they don't degrade, but every item degrades individually. You could have an abyssal blade loose 50 health, but not your storm bow, or vice versa, or both, or neither. EBs will be able to hit back, not dealing damage to your troops but to your items, giving more strategy involved in item composition, as some items would be weak against some EBs (wood shield against dragon is bad idea) And finally, a new item in the oracle to buy. They are like health crystals, but regenerate one item to full health instead. Repair hammer, or reforging, or something.