I don't think the problem is with monster or AI player armor being too high. Rather, the problem is the player having too much armor on his units and champions. This can create invincible units that can steamroll anything.
If I were you, I would hard-cap the mitigation of armor at 80%, 75% being the marker for armor equal to damage, and 80% being mitigation where armor*2 = damage.
In addition, currently the AI never uses shields or helms. As a player, I can get above 40 defense using a shield. So there is an overlap of problems here, where - if the AI starts using shields in the future - you could end up in a potentially devastating situation for players.