Armor pieces:
Coldain Quest Armor - Drops from 40-50+ Giants in Kael (This is groupable)
Giant Quest Armor - Drops from Dragon Trash in West ToV (This is raid content, 2-3 solid groups)
Dragon Quest Armor - Drops from 58-63 Dragon Trash in East ToV, AKA Halls of Testing (This is raid content, 2-3 solid groups)
Faction affects several other quests. Coldain notably has the Coldain Rings and Shawl. Dragons have some very good groupable quests like Circlet of the Falinkan, Bracer of Hammerfal, And Leuz Task. Giants have a few decent ones like Coldain Skin Boots/Gloves.
Primarily though, faction helps traveling a bit. Being friend with dragons (Claws of Veeshan) means traveling freely in Skyshrine, not being killed by Wuoshi when getting ported to Wakening Lands (A dragon placed right at the druid/wizard portal), and not being attacked by dragons in Western Wastes. Coldain faction allows you to use the city of Thurgadin for all purposes you may need (reagents, bank, tradeskills... It will be a central hub). Giant faction lets you use Kael for banking.
I prefer being Dragon+Coldain friendly. It allows you to travel safely most places except Kael. It lends itself to most of the best quests. The Dragon quest armor is generally the "best" stats wise, may depend on class though. Plus killing Giants is fun.
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