Armor Class (AC)
AC shows how easy (or hard) it is to land a hit when you attack with a weapon, fist, arrow, etc. Everyone starts at 10. Only shields, Dexterity ability bonus, magic items, or magic can raise or lower it.
Armor does not change AC. Even a knight in full plate can still be struck - AC is about whether the attack connects, while armor itself Damage Reduction: DR.
A shield gives a +2 to AC.
Damage Reduction (DR)
Armor protects by reducing damage once a hit lands. Types of armor has a flat DR value that is subtracted
from the physical damage taken.
Creatures, monsters, etc. may have a physical or magical component that raises their DR naturally.
Shields do not have DR and do not reduce damage. Shield raises AC, making it harder to hit you.
A natural 20 ignores DR completely.
Critical Hits
A critical hit when attcking, you roll a natural 20 on a 1d20. This causes two times more damage.
Critical hits bypass DR. No matter the protection, a perfect strike ignores all DR.