Why is Dwarven armor not highly treasured?

Question

I'm reading through the Silmarillion when I came across this passage:

... yet, in the tempering of steel alone of all crafts the Dwarves were never outmatched even by the Noldor, and in the making of mail of linked rings ... their work had no rival.

I knew that Dwarves had a gift for crafting of all sorts of things but I never realized they were ever considered the "best" at anything, with that title being reserved for the elves. To seemingly back this up, it is shown that characters seem to prize finding elven made gear above almost all else and even in various LOTR related RPGs you can assume that elven made armor will outmatch its dwarvish counterpart.

That being said, is there anything to explain this dynamic? Did something happen in a later age to change this claim? Or is it assumed that elven gear is imbued with magic, like with Sting, making it more sought after than a similar dwarfish item?

Answer 1

Dwarvish items are highly treasured.

Thingol's armouries:

Thingols armouries were stored with axes and with spears and swords, and tall helms, and long coats of bright mail; for the hauberks of the Dwarves were so fashioned that they rusted not but shone ever as if they were new-burnished. And that proved well for Thingol in the time that was to come.

Beren's knife (confirmed by the index to the Silmarillion to be of Dwarvish make):

Then Lúthien rising forbade the slaying of Curufin; but Beren despoiled him of his gear and weapons, and took his knife, sheathless by his side; iron it would cleave as if it were green wood.

^{Angrist Iron-cleaver, the knife made by Telchar of Nogrod, taken from Curufin by Beren and used by him to cut the Silmaril from Morgoths crown.}

Elendil's sword (confirmed by The King of the Golden Hall to be of Dwarvish make):

Against Aeglos the spear of Gil-galad none could stand; and the sword of Elendil filled Orcs and Men with fear, for it shone with the light of the sun and of the moon, and it was named Narsil.

^{In this elvish sheath dwells the Blade that was Broken and has been made again. Telchar first wrought it in the deeps of time.}

In fact three members of the Fellowship had Dwarvish gear: Frodo's mail shirt, Aragorn's sword and (we assume) all of Gimli's equipment.

Answer 2

Certainly in the LoTR movies and perhaps in the books too (it's been 10 years or more, unfortunately), the dwarves made metal items for Elves. I don't know if it was done to Elvish specifications or something else.

But this might imply that some or even many "Elvish" metal items were actually manufactured by Dwarves and traded to the Elves.

Specifically, reference the dialog in the Fellowship of the Ring movie discussing Moria's trade

The Doors of Durin, also called the West-door or the West-gate of Moria, were created in the Second Age by the Dwarf Narvi, as the western entrance to Khazad-dûm. In these times, they stood open and were guarded by a doorwarden, allowing free and friendly trade between the Elves and the Dwarves.

In The Lord of the Rings, Tolkien wrote that mithril is found only in the mountains of Moria, where it was mined by the Dwarves.

http://en.wikipedia.org/wiki/Moria_%28Middle-earth%29

If elves could do it better, there wouldn't be any need for them to trade with the dwarves.