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Hmm, the other items usualy came up after a few runs of the dungeon, this one hasn't come up in like two weeks, and at this point and level just running through the dungeon again does nothing for XP and is just running through the motions cause I can't fail it. Imho I'd tie the percentage to the character level so it's a much higher percentage at higher levels, but after all this time it just feels like I've stumbled on a bug.

(+1)(-1)

I can guarantee it's not bugged. Nevertheless, later on the game you'll be able to unlock the Bad Luck Shop, which sells Special Dungeon items in exchange of a currency earned after running Dungeons, similar to the higher drop percentage at higher levels suggestion you had.