Genned characters will always be wearing clothing that fits them so in theory you could definitely make dwarf civs have banditry up the wazoo and harvest them for their delicious steel shells. Or try. Keep in mind that adding the [local_banditry]
token will cause members of the entity to become hostile to your adventurer no matter what*. If you wanted to be able to be able to harvest dwarf bandits for their armor you could, I suppose, create an entity that is sort of a cross between dwarves, kobolds and goblins. Make sure they have no clothing, only armor, no civilian proffesions, live in caves so they don't generate confusing towns of naked or armored psycho midgets, and have local banditry and stuff. That or you could just find bandit camps. Which would probably be much less painful.
*Starting an adventurer in a town of an entity with local banditry will result in the NPC's being friendly the first time around. Return to that town or go to a different one and they'll cut you to giblets. They will talk to you like normal and stand around like the useless plebs they are but if you try to move in their direction, even when lying down, rather than move (unless you alt-move) your character will attack them. A bit of useless information for you, I guess. Also, if you want useable goblin towns you'll want to remove the tag, unless of course you want to commit goblinicide without antagonising them.