My Looting III diamond swords are not causing greater drops. It's most notable with Endermen, which I used to get 1-3 ender pearls with each kill with a Looting III sword. Tonight I killed 5 endermen in the span of a few minutes and didn't get a single pearl. That's not "Bad Luck", that's "Something is Broken".

I'm playing on a Survival Hard Realm; mobs have been spawning like crazy since the update.