I expected the baby zombie to drop my armor and sword upon death.

There were no items gained after he died, Keep in mind this was armor I had made and not loot it spawned with. The Baby Zombie did not spawn with these items, player items drop 100% of the time on regular zombies.

1. spawn a baby zombie.
2. Throw armor at it until it wears it.
3. Kill it, and watch your armor disappear forever into the abyss.

(Possible just change baby_zombie drops to true) I haven't seen the actual code so I wouldn't know for sure.