In a little more detail:
Group A rolls their total damage, say 150
Group B rolls their total damage, say 200
The losing group (A) would take the difference in damage (50).
If there were 2 people in combat, they would each take 25.
Each of the players would subtract their armour's amour value from 25. So if Player a was using Chain (14) and Player b was using Leather (6), then
Player a would take 25 - 14 = 11
Player b would take 25 - 6 = 19
As you can see, that's really really simple. And if you don't understand, don't worry. When we actually play, we'll figure it out.
Damage itself = weapon damage + weapon skill level dice (I think) + combat adds. Combat adds are based on STR, DEX, and LUCK.