So, when my group first read the rules, we didn't look to closely at penetration. We figured it broke the armor, rather than just ignoring it. Even after discovering out screw up, we still play with it like that. So for example
I'm wearing Enforcer Light Carapice (5 to all I think) with toughness bonus 4 (total 9 everywhere)
I get shot in the chest with an autopistol. We'll say it has pen 2, which I think it does.
So, when applying damage to the body, I would reduce my armor during the attack, and for all subsequent attacks, to 7. But only on the body. If I get hit in the chest with the same pistol 2 more times, the first shot reduces my armor to 5, and then the third reduces my chest armor to 4. Why 4? Well remember how Light carapice is a 5 armor and my toughness is 4? While the penetration still ignores the damage reduction for toughness, it doesn't destroy toughness (I'm still as tough as I ever was) but it has shreded my chest armor.
This does not apply to power weapons/armor. Use Trade Armorer to fix the broken area. If all the areas lose their armor value, there isn't enough left of the original to put anything back together.
In brief.
Armor, but not toughness, is removed after each shot equal to the penetration value. Pen still ignores toughness, but does not destroy it. Use Trade Armorer to fix damaged armor. Let me tell you, it makes the combat go so much faster.