Resistance represents your character's physical toughness and ability to shrug off damage, and is calculated as follows:
When someone strikes you in combat, their Core Damage is calculated (in exactly the same way as your Resistance), multiplied by 100, then divided by the sum of their Core Damage and your Resistance, rounded up. This is then applied as a percentage to their actual Damage rating (so if their Core Damage is exactly the same as your Resistance, their maximum damage will be half of their Damage, as described in 'help damage'). This percentage will never fall below 25%.
Once the damage has been calculated, your armour will soak a percentage, then auto-absorb is applied, and then any remaining damage is subtracted from your health (see 'help health').