Basically, armor % affects the TOTALITY of missile damage, not just the damage required to destroy the armor block.
So for example, say 100k missile damage gets applied to an armor block with 50% armor. Normally, the damage applied to the armor block would only be 50k and then the damage carried over to the next block would be 100k minus whatever the damage it took to destroy the armor block. HOWEVER, currently the damage that carries over is 50k minus the damage required to kill the armor block. What this does is that it SEVERELY reduces the damage of missiles against armored targets, to the extent that they become practically useless, especially with multiple layers of armor since the damage reduction becomes exponential.
To test:
1) Make a missile system
2) Fire at a block of armor (flat surface to make the calculations easier)
3) Notice how the amount of blocks destroyed doesn't at all match up the missile's damage.
It's pretty easy to see that something is wrong. I have a ship that uses missiles as a main weapon; it shreds armor and shield HP but does barely anything against structure HP (even with shields and armor hp at 0%). HOWEVER, if the target has no armor then the structure HP will take the normal amount of damage.