So, while difficult with sprites (needing to make many different sprites), 3D models will allow variation on the spot.
The suggestion is simple, instead of making certain foes (gnolls, kobolds, etc.) have a fixed look, allow them to use different helmets, armors, boots etc. Thus helping reduce the clone syndrome. This however doesn't mean the enemy has to drop the item he appears wearing though. It's just to add graphical variation to the opponents, not a random-loot on enemy system (although I suppose that could work too in a way).
Thoughts, yes/no? Any insights why even if this is possible many modern games still don't do it? All welcome...