I know that AC as addaffect should be set positive to be good it's ARMOR as addaffect that should be set negative.
Ac and armor, when set in OLC, both affect the player's ac, when the item is worn.
Ac is set in the Values menu, (under C), and armor is set as addaffect, (under D).
The value should be set as positive and the addaffect as negative to lower the players AC.
Example: ac 5 and -2 armor lowers the player's ac with 7
But you are right about one thing: There is a typo that should be corrected.
The addaffect is called ARMOR in OLC - AC doesn't even exist as addaffect.