I would like to see it work like the rest of the armor system with a shown durability ##/##, and possibly have the ability for smiths to repair them (and smith repair deeds).
Non-exceptional armor could be 150/150 to start, and exceptional could be 255/255. That would balance out the difference (IMO) between the Paroxysmus dragons and the normal ones.
Dragon barding condition can be found by using Arms Lore on the dragon while dismounted. This can be done by anyone with 0 skill at 100% chance to succeed. There are several stages the armor goes through so you'll know when it's getting close to being destroyed.
For the record, the damage reduction for each type of barding is as follows:
Non-Exceptional (any ore color)- 10%
Paroxy Swampy- 12%
Exceptional (any ore color)- 20%
Ore color has no bearing on the longevity of the barding.
Additionally, barding deeds of any type can be insured, so you can carry extras and still retain them if you die.