It's my opinion that, like an unlocked unlabeled chest, a horse kept in an accessible unlabeled place is not really within the realm of staff being able to enforce rules over, especially when it is a fellow village member in question. Lock your chests, secure your horses, make your rules public and accessible.
I do think taking that horse armour may have been walking in a slight grey area as to whether it was okay to do, and it may be a good olive branch to replace them if you care to. However, I am not interested in pursuing the theft charge with regards to the horse armour in this case. I would have probably leaned towards a different decision if the horses were clearly in a protected, contained spot. But when things are left pretty loosely in an accessible place, I don't think it should be Staff's problem when it is unclear if it can be taken, and it does get taken, just like with unlocked chests. Again, especially when it's another member of the village we're talking about.
I am ready to close this report with no staff action taken. However, I will wait to allow other Staff to weigh if I'm wrong in my thinking here.