Basically my understanding is I should be equipping whatever gear boosts my stats right? As of now I have not spent gold to get gear I just use what I loot in game. So is this what I should be doing or even though a sword doesn't boost my stats it could still be a better sword then some other weapon? (Hope that makes sense).

Then my other question is this. How come I can have a rare (green) sword that boost my stats but isn't worth much in at auction maybe a few hundred, then I loot a (pink) lightening sword which puts my stats negative but I can sell that for a cool 1,000 gold.

Does this make sense and can someone maybe explain a little more to me?
Thanks!