It's not a big nerf, and the padded armor that replaces it it actually stronger than it was (leather was +3 armor, now it's +2, padded is +4) and is simple enough to get. Unless I forgot to add it to the shops... But bandits should drop it.
the only thing I'm not satisfied is the image, but I couldn't find a better padded armor/gambeson image to use.
Plus, with the addition of new items that can be sold for $$$, you're still looking at a net positive.