I agree that by a literal reading, there is a clear right answer. However, what is unclear is whether a literal reading was intended. An example or two, or a few sentences explaining what it does and does not stack with, would dramatically enhance clarity.
I agree. In this day and age of Internet, I think the designers should already have an errata document clarifying anything which is contentious on the various boards.
However, I also have to wonder if the "this replaces armor" intent is actually valid. This puts 8th level PCs with Dex 20 at AC 21 without other buffs, without shields, etc. That's pretty buffy, 3 above Mage Armor.