Dodge now been removed from the game.
Dodge items do not stack additively. For example, Jax, with level 5 counterstrike, has 18% dodge chance. If he then picks up ninja tabi (+12% dodge) his total dodge chance is 28% (and not 30%).
It's easiest to simply calculate the highest %dodge first (as they stack multiplicatively, order is actually irrelevant): In our case, the 18% dodge chance from counterstrike is simply added (18% of 100% hit chance is 18%) so Jax's dodge chance is 18%, and his "be hit" chance is 82%. Next, the dodge chance from ninja tabi is added. 12% of 82% "be hit" chance is 9.8%, which then gets added to the previous 18%, for a grand total of ~28% dodge chance.
If there were another dodge item (say, an identical version of Ninja Tabi that stacked with itself), the +12% dodge would be 12% of 72%, or 8.6% increase.
The reason dodge is handled this way is such that the mitigation of dodge as a stat scales linearly; were dodge strictly additive, the more dodge% you had, the more damage further dodge% would reduce.
Ignite
Casting ignite on an already ignited target will reset the duration of the DoT, losing any remaining damage the original ignite would have done.
Speed
I'm just going to quote from the "mechanics FAQ" from the official LoL forum.
Q: How do movement modifiers work?
(Credit to Larias)
A: First, you have your base movement
of say 300. You add boots first,
always boots first, so if you have
boots added.
Let's say you get boots 2. That's 370
movement. Then, you get 35% movement
speed buff from items or runes or
masteries or buffs: that 370 is
multiplied by 1.35, or 499.5 movement
speed. If this is the only thing
affecting your movement speed, the
diminishing returns formula kicks in.
Now, let's say you get slowed by 38%
(ashe arrows). What happens is the
ORIGINAL 499.5 is multiplied by .62,
and you get 309.69 movement speed.
Because 309 is not above or below
diminishing returns, you stay at that
speed.
Q: What are these diminishing movement
returns? (Credit to Guinsoo)
A: For each point of movement you
would have above 490, that amount is
reduced by 50%. So if your final
movement speed was 748, it would be
reduced to 490 + (748-490)*0.5 = 604.
For each point of movement you would
have above 415, it is reduced by 20%.
So if your speed after all mods was
445, you would end with 415 + 30 * 0.8
= 439.
Q: Do slows stack?
A: Yes and no. Slows from items do not
stack among themselves (Phage, Frozen
Mallet, Rylai's Crystal Scepter).
However, all other slows stack.
Just like the diminishing returns for
bonus movement speed, being slowed has
diminishing returns starting at and
below 210.
And one addendum: The strongest slow/speed boost is always applied first.
Lifesteal
Lifesteal has no diminishing returns. If you hit an opponent for 20 damage, and manage 200% lifesteal, you will regain 40 health.
Lifesteal is based on damage done, so it is reduced by Armor (which does not have diminishing returns, see below) and doubled (or more!) by crits.
Attackspeed
+Attackspeed from items is additive and references the base attack speed of the champion. Buying two phantom dancers, for example, gives you 110% additional attacks per second, but because they are additive, the effect doesn't increase due to any other items you may have.
Attack speed has a hard cap of 2.5 attacks per second.
Armor and Magic Resistance
The effectiveness of Armor and Magic Resistance do not suffer from diminishing returns.
Please see this answer for a fully detailed explanation of why.
Okay, from my experiments, it goes:
Armor/MR reductions <--> Percentage Reductions
(They stack multiplicatively, so order is irrelevant)
Flat Reductions
This makes sense, since if flat reduction was the first thing applied, after armor, it may have failed to provide a benefit at all (since, for instance, the difference between 50 * 27% and 48 * 27% is minute at best. 50 and 27% being the base attack damage of Ezreal and the armor of Amumu, my two test characters.)
Shields act as health, and damage done to shields is likewise reduced by armor / magic resist. (Meaning shields on tanks can generally absorb more punishment than shields on squishies)
Best Answer
As I mentioned in the comments, you're looking at the wrong aspect of armor. You shouldn't be looking at the percentage it reduces, but rather the amount of damage it actually prevents as a measure of how much longer that armor lets your survive.
Let's consider an example for a champion with 0 armor. Say he has 1000 health, just 'cause that's a nice round number. Now our champion gets caught in Garen's judgement, and starts taking 100 physical damage each second (at one hit per second). Clearly, our protagonist can take ten hits before dying.
But now, imagine our champion has the 50 armor you mention, meaning the incoming physical damage is reduced. Now (still with 1000 health) it takes 15 seconds for that bastard Garen to claim our champion's life. 50 armor extended our life by 5 seconds. (100 * (2/3) = 66.6 DPS; 1000 / 66.66... = 15 hits)
So our champion respawns, wises up, and buys 50 more armor. Now with 100 armor, we're sitting at a flat 50% damage reduction. Again we run into Garen, who's still dealing 100 base damage per second. It now takes him twice as long to kill us -- 20 seconds. Once again the armor has extended our life, again by 5 seconds. (100 * .5 = 50 DPS; 1000 / 50 = 20 hits)
Back in base, we buy another 50 armor. We're now at 150 armor, and 60% damage reduction. Enter Garen -- spinspinspinspinspinspin and it takes 25 seconds before our champion dies. Again, adding 50 armor extended our life by 5 seconds. (100 * .4 = 40 DPS; 1000 / 40 = 25 hits)
So even while the amount of damage reduced per point of armor diminishes (as you observed), the amount of time armor extends your life (or effective health) remains distinctly linear.