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You won't lose your character if you can somehow get the Demon (now WHAT was his name again?) to submit to your will. Perhaps if you knew his TRUE NAME he could be forced to serve you? Maybe a mage might have a SPELL that can Divine his name for you?
Assuming that you can get the armor so that it won't cost the life of the wearer (and it can be done), I would suggest saving for a later use. Its not worth wasting it on the Drowned Dead.
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