Is this something everybody is getting? I feel like there is absolutely no point to the loot in the world. Only crafted items seem to be powerful enough. Everything else is mediocre at best. And it's getting old looting relic a few levels below me while the guards are a few levels above me.

Update: Loaded a few times before looting (as you know the item is randomly generated when you first open the container).
It has now been level 13 a few times and got as low as level 11.

I am taking it as money making.
I agree with you.
Als happened to me that I was making quest on witcher armour (recommended level 20 and I had 21) and that dead witcher lying next ice golem with level 30.

I'am pretty sure the game is not designed to be the typical "Hero loots dungeons to get equip" RPG.

You craft witcher gear and the most valuable thing you loot from chests are recipies :)

I dont buy any, because the more recipies I buy, the less happy moments I have opening chests :D

Loot scales with your level and seems to always be a bit lower than your current level. I cheated in a second playthrough (to try and do things out of order and see how the game reacts) so that I was level 50 and random drops I got in White Orchard were in the level 40-50s. Kind of a weird way to approach drops.

Although most of the stuff you find is low level I managed to find enough pretty good stuff - especially treasure hunting can be a good way to get proper equipment. For me it was never really necessary to craft something. But of course crafting can get you better looking armor.

Well not every place can be Fort Knox. After all how would a monster know if a sword is really good. Maybe they are just guarding a shiny and have no clue if it's good or junk. I like the idea a widely ranging loot. Maybe that level 5 monster has a level 35 sword while that level 30 monster is guarding a bottle of water.

Still feels wrong that I can craft a yellow silver sword for my level and it will be a dozen or more damage better than a relic I find defeating a monster who is quite above me in level.

Would if make you happier if they removed the term "relic"?

I know that many RPGs have legendary items which are way below your level and are thus useless, which never seemed to me like a sensible idea. Not sure what the best solution is, but the current one does not seem completely right. Probably it is the case for more experimenting with different loot-level models.

I did not have this problem in Guild Wars 1, for example. All items there were just various kinds of gear, and it was you who could name them. Hence you did not really have a feeling of finding an ancient relic which 'must' be stronger than the regular stuff you have.

Look at it that way... The gear of that reclusive special sect that you belong to.. the Witchers... (exchange with Samurai if you want).. is, always was, and always will be better than anything even the elite human population ever had.

So you might find a "Relic" of a legendary Knight from a past age... but its still inferior to Hattori Hanzo.. uhm.. Witcher Gear :D

You have a point!

loot scales with the player level from what I've seen as you become a higher level.

Sometimes you can find something that is way higher than your current level but that's only happened to me like 3 times total out of many hours.

Loot system in game is very funny (or outright broken, by my opinion). At times "guarded treasure" cache, that is guarded by very high level and dangerous monster may have only white and blue items, or pure rubbish. Yet totally inconspicuous chest may have outstanding item. Relics aren't unique, I found several versions of Longclaw and Moonblade swords at various levels. While exact types of items apparently not changed when you loading save, their level is. Before 1.05 levels varied as much as -20, saw an item of level 10, while being level 30. At top I saw -2 level. Traders' stocks also seems to be (at least were) susceptible to this "random level" rule, that at times made very powerful items available. Overall, regarding caches, judging by Skellige (as there around 80 of them), very few contained decent stuff.

Loot is a bit wonky, you use looted weapons and armor more so early on. Later in the game once you get full sets of witcher gear (and the upgrades), Geralt basically turns into a glorified traveling merchant. lol