No, the effect is not being suppressed in some way (not that that would make sense with the numbers I'm getting, but still). The +2 Dex does appear and update on my character sheet, but my Reflex only goes up by +3.

 

However... I'm not sure this is actually the Belt's fault. I've read about a bug that causes negative save modifiers from stats to have 1 less point applied. My barbarian has 8 Per and 10 Dex, so she's usually rolling with a -4 to Reflex. However, without any boosting items of any kind, she has 35 Reflex at level 7... when she should have (20 + 3*6 - 4 = 34). So only a -3 to Reflex is being applied. It seems as though the +2 Dex is actually canceling this bug out by adding 4, which cancels out the penalty of 4 and allows the whole penalty to be applied because.. reasons?

 

This situation is kind of hard to explain. Does what I said make sense? Normally I have 1 more Reflex than I should, but when I equip the +2 Dex item this cancels out and I end up with the correct amount, even though it looks as though the belt is only providing 3. Weird stuff. Y'all should probably fix it or something. ;P

Yes, this definitely looks like low attributes bug, a nice catch.

 

It's as you said, the bug is active only when one has sum of two attributes which contribute to the defence < 20 (here Per + Dex = 18, and thus Reflex defence is bugged). So in your situation when you rise those attributes by 2 or more (either by equipment of by other buffs -- it can be +1 Dex & +1 Per | +2 Dex | +2 Per, | +4 Dex... ), the bug is not active any more. Well, this is tricky for player's confusion:(

 

Just for to be sure, you can also try to check Belt's functionality on the character with Dex+Per >=20.

 

Linking kmbogd's thread with Forest Troll situation if further info is useful:
http://forums.obsidian.net/topic/76661-deflections-dontt-stack-properly/?do=findComment&comment=1652360