Q:
Fractal Loot and fractal levels
1. You get your personal reward level or the level of the fractal, whichever is lower. I believe this means you cannot get a ring if your reward level is below the level of the fractal.
Tested: We did fractal 28. My friends reward levels were 30, 28, 41, and I dont know what the PuG had. They all got 10 fractal relics per chest. I however was only receiving 9, as my personal reward level was 23 at the time. This indicates that I was getting my minimum (23) and they were getting theirs (28)
2. I believe it should be the level of the instance to determine the drop. I have not tested this, but it seems like it would be logical, as the monsters do not lose strength if you bring lower fractal level players into a higher fractal, thus they should be the same monsters, with the same loot tables.
3. I believe it will give you the level 26 loot scaling. I dont have any evidence for this, but it would seem sort of weird to not do it that way.