The various items are all labeled with "tattered," "brittle," "ragged," "faded," etc., etc. Obviously the rarity is a better measure of quality as a rule, but it's easier to say "Oh, rare faded blah blah. I have a rare ragged blah blah already. Sell." than it is to spend time inspecting the stats... There seems to be a method to the madness, but I can't figure out what the order is.
Or am I just overthinking this or overlooking something?

It's based on the items level

So like, all level 20 items will be "tattered", all level 25 are "faded", and all level 50 items are "rough"

So the "required level" is what those names are connected to?

Yup, exactly that.

edit: also note that there are some special items that bosses drop or purchased from special merchants that have specific names, and so they don't use the same "rough" "tattered" etc in their names. Those would be like "Talons Armor" or "Bracelet of Force"

Awesome. Thanks for clearing that up for me! ^^