Yes, you can.. The beauty of it is, different items give different types of bonuses to AC. For example, a Ring of Protection will grant a deflection bonus, boots give Dodge, amulets Natural, armor and bracers Armor, and so forth. One of each of these bonuses stack (One ring, one pair of boots, one armor), but if you have for example two rings that both grant a deflection bonus, they don't combine, the greater one is used.
I did some mild exploration before I realized as a low-level elven sorceress I was a sitting duck. I picked up Daelan quickly, before third level at least..
Don't explore the town proper. Well, you can if you want, but it's sort of meant to be taken one district at a time. Aribeth will give you an idea of where you should look next, if you ask her. They increase in difficulty, you see. But have fun in the City Core and don't get killed.
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