I understand the difference. read what i wrote.
vengeance is still gained on avoided hits. if you get hit for 80k or if you dodge an 80k hit you get the same vengeance.
increasing your mastery increases the effect on the exploit on stacking vengeance.
if you have 50% DR (using the 80k hit example) you get vengeance as if you got hit for 120k
if you have 99% DR you get vengeance as if you got hit for 8000000.