How to deal with...

[DualQuad]

What is the best way to deal with an item (Iron Armbands of Power) that grant a +2 to all melee damage dealt by a character?

It seems like I should create an Effect like "armbands;DMG:2" and just apply it to the character continually. Is that the standard way to go?

DQ

[Tenian]

The ATK effects take M or R for their bonus (ATKM:2 = +2 Melee Attacks).
I believe DMG takes them as well.

[Griogre]

You can use effects but as it's something that is always going to be applied I would add the bonus to his various weapon's melee damage on the combat tab.

I think you should avoid permanent effects on a character as much as possible because once you get up to high heroic or more there are a lot of effects that get stuck on characters and having a lot of permanent effects makes it much harder to see the other non permanent ones. At paragon some of my players seem to have problems with effect data overload.

Even at lower levels I have a swordmage character in a game with four resistances and I notice that the other players often seem to not notice when he gets additional effects placed on him in combat because he has that "wall" of resistance effects.

[Tenian]

I recommend toggling the visibility option of effects to GM only if your players are having troubles.

I find it is a lot easier to add/remove a single effect than to go through and adjust all the powers or weapons

[Griogre]

That's an excellent idea, Tenian - I totally forgot about the combat tracker toggles. I've never used them before, I guess.

[miniwheat]

The easiest way to apply the bonus for the armbands is to go to the combat tab of the character sheet and bump the dmg up by 2 on all melee weapons listed there. There really isnt a reason to add an effect because the item adds 2 damage to all melee attacks made with any melee weapon.

If you are worried about double item damage bonuses stacking or something similar then I could see the need for an effect.

[Zeus]

There's also a new option in 2.7.0+ that allows Effects to be output to the chatpad at the start of a PC's turn. If you disable the effects visibility on the CT to reduce confusion you may also want to disable the option for outputting the effects at the start of a turn.

Having said that my groups find this feature very useful, especially when as you say they have several effects in effect (excuse the pun).

I have also seen a request for 4E Effects to support better text labelling moving forward, hopefully this will aid effect tracking. I'll be seconding that request.