Valkyrie helm and fallen armor have a medium bonus for fiend and a medium penalty to fiend, so they should cancel each other out.
However, it instead results in this: http://i.imgur.com/5SYYL.png
Low bonus? Low penalty? Nothing at all? Who knows, but it's sure a bug.
Have you tried testing the damage mod to see if it leans in any direction? Assuming its actually canceling out, it looks like the game sees both mods but doesn't know how to handle a net result of 0%.