With all these penalties to melee, and the way armor works (heavier armor - slower attacks) – is there anything that makes up for playing an armored knight/paladin-style damage dealer? Do they deal inherently more damage from melee weapons or are their abilities/traits/whatevs better?
I was planning to play a ranged rogue anyway (I would want to play ranged ranger like my first BG playthrough, but rangers in PoE seem... weird, and I don't like how pets work), but I'm just curious.
Nothing. Ranged DPS is objectively better than Melee DPS and the only thing you want to have in armoured plate is the tank. Classes are balanced independent of the various mechanics in the game, which is great for build variety, but it also assumes that those various mechanics work well together. And.. they don't, really.
So where one game would go with the assumption that Paladins will be wearing plate and therefore be gimped when doing damage (due to the pre-existing issues of the armour system itself), they could up the Paladin's damage to have him remain competitive despite his core concept, but PoE makes no such assumption about the Paladin, and he is free to wear anything from Clothes (which is not the same thing as robes, for unclear reasons) to Full Plate.
I do not consider that in and of itself a flaw (I in fact consider one of the very best features of PoE) but it does mean that the mechanics, as it stands, is all kinds of messed up in relation to presented concepts and pretty basic assumptions. For example, in PoE, Barbarians does amazingly with Intellect, and if you want to play a damage-dealing Paladin (instead of a tank), you not only will do terribly with Resolve (which you'd otherwise assume to be a prime attribute for Paladins) but you will also be objectively better off dressed in regular clothes than in full plate.
But there's threads flying around that can fill you in a lot on that, let's try to not derail this one.