Neither. Fill your bank with centi belts and lego pads until you have out-levelled crushbone. That will be the best time to hand them in imho. If you hand them in at too low a level you won't get the max amount of xp from them.
Hunting will provide cloth/raw hide/ringmail/bronze armor as you progress thru crushbone, then unrest and mistmoore. Going by my own experiences, reds/yellows won't care about your AC and blues/greens will struggle against even cloth/leather at these levels. Its almost as if there is a hidden cap on your worn AC as you level up.
As such you'll find 100pp spent on a decent weapon gives a much better return than purchasing banded armor. After this player made HP rings are good at low levels to help you survive panic situations.
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