They did have armor, they all had shields, helms, and at least copper breastplates.
More armour. More coverage. I don't know if enemies are smart enough to go for unarmoured body parts, but having only those three items leaves the arms and legs totally open. Bone gauntlets and greaves are... well, they're not worse than useless, and you can always use the spares to buy some materials or proper armour off the caravans. Try and get both mail and breastplate, as only mail covers the upper arms. Cloaks and hoods are very good armour, and I
believe those two items cover areas that no other armour does (face / throat).
Starting with ranged attackers is also an option, especially since dwarves can use goblin armour right now. Kill them, steal their stuff, and either wear it or melt it down to create armour items that goblins don't bring (ie. most of them). Then you can start meeting them in melee. Use twisty passages to control line of sight so that your forces don't string themselves out chasing everything they see. If there aren't any ranged attackers, the civilians can join in too. Civilians (or more correctly, dwarves who are in a squad but currently inactive) can carry weapons in .31, and civilians with crossbows will engage enemies until they run out of bolts.
Have you dealt with many ambushes? It seems odd to go from no military problems to 'omg siege' without going through the ambush stage first.