Leather armour is not better than metal armour under any situations, as far as I have seen and the RAWs indicate. Also, even if they were blunt attacks, steel plate would be better than leather or only chain--non-rigid armour gives almost no protection against blunt weapons at all!
My belief is that leather does in fact offer protection to blunt weapons. You are right that it is inferior to metal when looking at the raws. However a non-rigid armour offers some protection against a blunt attack. First the non-rigidity functions as a shock absorber, second when a blunt strikes plate the result is that the plate strikes the wearer (newtonian physics). Look at medievil armours and most plate sets come complete with extensive leather underneath.
Whats more I believe this is in the game, if you look at plate dwarves being hit by hammergoblins you wont see the plate mentioned, if you have leather layered below then often the attacks do their damage 'through leather XXX'. What seems to happen is hammer hits plate, plate hits dwarf through leather (here is the elusive armour vs blunt)
I like to give them metal mail shirts and helms to ward off the odd insta-kill, otherwise they get leather as it lets me reposition them faster. Once elite or if they never really move from behind fortifications I tend to plate them like the melee. That is full plate and as much leather as will fit underneath it.
I think this too is bogus xD. IRL, a rigid armour doesn't just automatically confer all the force of a blow onto whatever is behind it--it spreads it out just as a more pliable one would. However, said soft armour actually dissipates this force much less effectively than rigid armour--it doesn't absorb nearly as much of the energy, allowing it to be transferred to whatever is behind it. There is a reason nearly every historically effective armour has rigid elements (from plate to modern military bulletproof vests).
In dwarf fortress, I think it just doesn't list all of the parts it performs calculations against, possibly listing just the last result (likely the one closest to the skin--in almost all cases this is the leather XXX you mentioned), as armour will stop most blunt attacks in a situation where a dwarf in a leather robe or whatever would be pummeled into oblivion. This is easily shown in arena mode. It just so happens that hammers, like whips, are usually good enough at piercing armour that even rigid plates aren't totally effective.
That being said, I always equip my dwarves (all military ones) with a full set of plate armour, a mail shirt, and a leather robe/cloak--which adds key protection to exposed digits which may easily become victims of bites or danger-room accidents (which leather can usually protect against adequately).
The drawbacks to heavy armour is that it does slow your dwarves somewhat. The armour user skill rapidly offsets this deficit.