I've played on Advanced Level ever since it was made available...
I can confirm that it gives much better drop-loot.
On Tribble with my Engineer, I've received 6 purple Boff's on my climb up to RA...
Unfortunatelly... Four of them were TAC's... Go figure.
I also got a Purple Shield somewhere around Lt Commander 5.
I wasnt aware that Difficulty settings effected the Rarity of Boff's you get. Unless they changed something on Tribble... But normally you always got greens at the first ranks, Blue's somewhere between LC-captain, and Purps above that rank.
Since Elite difficulty is so simple to beat (for me), I always have it turned on. The AI is always dumber than the brick on your wall.
Just leave it on Elite, VR drops come like candy
Advanced...Meh. Sometimes VR's come more than 3 per day, but Rare is the main drop of choice for this mode. Problem is, the AI is so slow and dumb that I can't be bothered with this mode unless I'm doing specific Feature Episodes missions that require it over Elite.
I know this won't win any points, but...Solo play typically yields more rewards than teams, as the rewards aren't shared and drop more often (typically).
I got 7 VR drops in 5 hours of playing once...Various sectors of space.