I have a suggestion that might help counter a kind of exploitation on land, as well as address some of the concerns with too much loot coming from boarding actions.
I just tried a new castaway start, and ended up on St. Martin. Which is clearly the place to go for an exploitive castaway, because all I had to do was talk to the dutch guard, he says the french are attacking, sit back, watch the battle, if the dutch civilians win, loot all the bodies, if the french guards win, run to a new scene and try again. In a matter of 15 minutes, at lvl 1, I had swords with max damages above 30, a musket, a grapeshot pistol, and many 1000s of gold of loot. With 0 risk. Now, obviously this is pure exploitation.
But I was thinking about the thread you guys had here a week ago, where you discussed many possible means of reducing the loot received in boarding actions, so that you could use the weapons you wanted without giving the player too much. And I wonder if that problem has the same solution.
How about whenever an AI who is not your officer kills another AI, they auto-loot all the possessions of their victim? Or if it could not be added to their own inventory, their victim simply appears as a corpse with no possessions to loot?
I think this would be both realistic and help game balance. On land, the player would be unable to carry out any exploit involving the AI killing each other, and this makes sense too, because if a bunch of AI kill another bunch of AI, they are going to claim the valuable possessions themselves. Why would they leave 1000s of gold worth of stuff for the player to claim?
In boarding actions, it would make sense as well. If a sailor kills an enemy in boarding, it seems only fair that they should get the benefit of the loot that comes from the enemy. How is it fair for the captain to only pay them a few coins a month, but if they risk death and out dual a dangerous opponent by being one of the select few volunteers to fight at the vanguard of the boarding action, the captain gets to pick up the sword from their defeated enemy and sell it for 200 times the sailors monthly salary and keep it? Wouldn't it make more sense the sailor himself would grab the enemy's purse and blade, and sell it for his own savings? I don't know specifically regarding the age of sail, but generally throughout premodern history soldiers have supplemented their income by looting their adversaries after battle. I would strongly suspect the same would be true of boarding parties for privateers.
And from game balance, it would limit the profitability of looting the high end weapons that everyone was discussing, without the seemingly unfair mechanism of making the loot simply go overboard or break. Instead, quite sensibly, if the captain kills an enemy sailor himself in fencing, he can keep the loot, if a sailor kills him, it disappears, whether completely from the game or into the sailor's inventory.
Finally, there would be an issue of officer kills. Maybe the loot should remain, because the player pays them much more. Maybe the loot should instead disappear, with the rationale being the officer sells it to fund their own savings, and by this mechanism some of the quick profitability of fighting on land would be reduced, and players would be incentivized to travel with a smaller shore party if possible. Maybe different answers should apply with shore parties vs boarding parties, as maybe by allowing the player to loot bodies killed by officers in a boarding action, players are incentivized to risk their valuable officers in boarding actions rather than keep them safely behind the lines.
There would be the occasionall frustration when one of your sailors charges in and gets the final killing blow on a guy you had mostly killed. Maybe this could be handled by awarding the kill to the person who had done the most total HP damage. But honestly I think killing blow would be fine. The occasional frustration would be compensated by the times you get a killing blow in another's dual as well, and it would all balance out in the end, and it is kind of fun to have the killing blow awarded the loot.
Most importantly, on the whole, I think it might help to balance the economy in both land and boarding.