@Leif: Well, I don't consider it a good idea to hoard several thousand gold pieces, while they could be used to buy magic items that could help us.
Using only what we find makes no sense, obviously. But when we buy things, we should figure out what to buy or for whom to buy something. It's way easier to just distribute the treasure and then leave the decision about what to buy to the individual characters. Selling only what is not used and distributing the gold evenly means, that some get way more than others, which is inherently unbalanced. Therefore it is often done as propsed here, that the items that everyone gets from the loot are calculated as part of their share (effectively they are buying them at half-price), and the gold is distributed accordingly.
I think Coraine is served better by better AC before better BAB as he's supposed to pull aggro (to use that horrid MMO phrase) first, hit second. I think the he could be served by a +1 longsword if that makes a more equitable split. In an ideal world, he'd have both.
The decisions about the swords were made before you took over, so obviously might not be exactly what you would have done.
The
+2 longsword was best used by Coraine (as he is the best fighter together with Ragnok, who does not use another weapon than his trusted heirloom). Of course, by then he was still a Paladin and not a Knight.
Generally, the items should be used where they best serve the party.
But everyone should also get a fair share and be able to get some decent stuff (some characters have next to nothing in comparison right now). Ragnok wants gold to get his weapon enchanted, surely Verdis wants to get
something as well. Dara doesn't exactly have a whole lot of decent equipment either.
Therefore I think it's most fair to do the distribution like that. Sum up the sell value and allow those who want items from the loot buy them for their sell value.
Maybe we should just start from scratch...
Coraine has his
+1 longsword still (so neither Kurt nor Trevor have it).
The
+2 longsword, and everything else (as listed in the RG; including the
+1 flaming longsword, the
+1 warhammer, the
+1 full plate and so on) is in the party treasury.
The sell value of the party treasury is 19691 gp 3 sp 4 cp.
That's 3281 gp each, leaving 5 gp 3 sp 4 cp in the party treasury.
The following (useful) items could be acquired from the party treasury (sell value in parantheses; if noone wants them they are sold for gold; if more than one wants any specific item, it should go to whoever can make the best use of it, also keeping in mind that not a single character gets everything

).
+2 longsword (4157.5 gp)
+1 flaming longsword (4157.5 gp)
+1 warhammer (1156 gp)
+1 full plate (1325 gp)
masterwork heavy steel shield (85 gp)
Bye
Thanee