My inner munchkin weeps at the simplicity. I suppose the system's fine, though.
Endurance should do more. The way you described it, it's entirely inferior to speed; for every point of END, you get one less -1 speed from armor weight... but for every point of speed, you get +1 speed, which has the same effect if you're encumbered, and actually has an effect at all if you aren't.
Also, I don't really see the point of buffing anything aside from SPD and STR, at least when only concerned with direct combat. Spending a lot on VIT/END means SPD/STR builds will almost always hit you, so it just means you wait a while longer to die, practically never getting a hit in. VIT/END could be buffed if there's environmental traps which just do guaranteed damage, though.
Also, VIT could easily be inferior to END, or vice-versa, since they pretty much exclusively affect the exact same thing. If ten points of END lets you wear 15 points of armor without penalty, while ten points of VIT grants you 10 HP, nobody smart would pick VIT. Easy ways to fix that would be to make armor be expensive (so VIT's free, end's not), or to make VIT grant more HP than END grants armor, but you can choose how to distribute armor across the body.
...I've been saying STR/DEX would be best, but it would probably be pure STR. 40 STR means you roll more than 20 half the time, and anyone with less strength than whatever you rolled would find it impossible to hit you, even if they get twenty die due to speed. Of course, there's a tiny chance of rolling a one or something, but that's so unlikely it scarcely matters, especially since you'll probably one-shot basically anything.
Hmm. Diminishing returns could sorta balance it, simply by making it worthless to invest in things after a point, but then there probably wouldn't be a lot of individuality between characters. People munchkins would still level the "best" stat(s) primarily, with the only individuality coming from exactly what they see as breakpoints, and what they think are good secondary stats. So, you might see STR/VIT, STR/END, and STR/DEX, but anyone who doesn't have one of those three would die if they fought one. And STR/DEX would probably win against the other two most of the time.
Of course, these statements could all be altered greatly depending on what abilities exist. For instance, an ability which lets you add your total amount of armor to an attack roll at the cost of some FTH would make a tank char more powerful compared to a STR/DEX char. However, I doubt abilities would grant much creativity unless there's just tons of them with interconnecting effects, in which case the simplicity is lost. So, yeah... munchkin's crying.
THIRD EDIT:
Maybe armor could provide DR, rather than additional HP? And if you take less damage than you have DR, you automatically hit? That makes a tank build more interesting, and makes the difference between VIT and END more notable. It acts as a hard counter against DEX, and sorta-kinda counters STR by making it harder for them to one-shot you, increasing your chance of getting a lucky hit. Of course, you'd need some rule like "you cannot have negative speed", or else I'll someone will just go for max STR and get all the heaviest armor, granting them 1d40 rolls, 20 DR, and -80 SPD.
FOURTH:
How does range work? If both people attack every turn, that means nobody's sacrificing an attack to close/retreat and get a better bonus. If both people get to change range once per turn, it'd just cancel out unless they have a competing roll. If said roll uses the attack numbers, it inherently favors status quo because one person probably has a shorter range than the other, so it'd probably be best to base it on SPD. An alternative would be to just lower range by one each turn, which could be interesting.
Also, does range work like the previous combat test, where a range 1 weapon never gets a bonus and a range 4 weapon never gets a penalty? I think the flaw there is obvious.
I think you missed the line about what range does
Range of the weapon adds an "Effective bonus" ie It gives +1 or +2 or whatever to the contest between the dice, but not to the damage dealt. Ie, 3+1 vs 2 would still deal 3 damage.
It should be noted that the numbers and stuff I gave weren't final and that the ratios here are not what I intended. Specifically:
Speed vs Endurance:
Even though I used numbers that made it seem like this, the speed regained via just pumping speed to offset armor wouldn't be as good as if you pumped endurance. For instance, again just an example not any actual numbers, armor with a -10 speed could be offset by +10 dex or +3 end. Something like that.
Vit vs End:
The big difference here is that HP heals, armor doesn't. And Repairing armor takes money and requires you to be in town. So you can go in there in heavy as fuck armor and just tank but if you have 2 hp past that armor and run into a rust monster or something, you are fucked. DR could work too, so you can tank through hits.
Str is op:
Yeah, kinda. Diminishing returns could work but it's still problematic because getting a generally higher number is always a better idea that just about anything.