Honestly, a large enough ship ought to be able to sport both effective shielding and armor. You use shields to protect everything from small arms fire, armor to protect some of the most important things and possibly most of the ship from certain angles when shields are lost.
They behave differently under fire from different effect systems and weapons as well: Missiles apparently do 100% normal damage to shields, and 50% to hull/armor (to simulate an undirected detonation on a flat surface; 50% of the energy would radiate out away from the point of impact. I haven't tested that aspect too thoroughly, though.) So a shield-only setup will be taking heavier hits from missiles. Armor blocks also absorb missile damage fairly well: I've tested a big 10m thick block of advanced armor versus a several-million damage nuke missile. The depth of penetration into the armor block while armor hitpoints remain was 3m eliminated, with the fourth damaged. Once hit point pool was drained, it still took two shots to penetrate to the systems behind it. Then once penetration was achieved, however, system blocks behind the breach (at the diameter of the breach in the lowest armor layer) were destroyed, back through the full 50m of the depth tested. There was a tapering effect where every 10 meters or so the diameter was reduced by 2, but it was surprisingly destructive. If you don't have that armor to absorb the first shots, those first missile hits will take you out of the game by chewing up enormous quantities of important internal components.
However, armor doesn't do so well against cannons or beams, because they use punch and pierce effects natively. A cannon/beam the size of that missile array only has to go through 10 or so armor blocks before spending the remainder of its penetration depth taking out systems. A beam, actually, ignores the armor entirely in affecting the blocks behind, because the pierce effect damages all blocks in the line per a set amount of damage, regardless of whether any of them were actually destroyed. But a large beam array, even if it can't destroy your armor, might still cough up the 50hp or whatever necessary to take out the systems behind the armor. The total damage per shot is a lot lower than from a missile, but it nonetheless immediately goes towards eliminating internal components and your structure hitpoints.
Both cannons and beams, however, lose that advantage while the shields are still up. They instead pour their damage into the shield pool until it is drained.
