Situational.
For your standard average piece of gear, its hard to argue a leather wearer should get precedence over a clothie on cloth. For best in slot gear, there might be some wiggle room, but I would say that wiggle room really only exists when said item is best in slot for the leather wearer, and NOT for the clothie in question.
Thing is, im not overly convinced that, for a resto druid, there is a large concern over wearing leather as compared to cloth. Cloth simply isnt that much better, if its better at all. If there is, its an issue with blizzards itemization anyway. It isnt the fault of cloth wearers, and it shouldnt really make sense that they get to face increased gear competition because a) you dont like leather, b) leather is subpar, the fault of blizzard, or c) you might just want increased opportunity to gear up - which rolling on cloth affords you well.
In any case, I find its a hard pill to swallow. There's enough crossover as it is, theres no need to further muddy the waters for cloth wearers by introducing yet another spec that wants to roll on their only options. Warriors, even though some mail is better than plate currently, shouldnt be allowed to roll on mail over a shaman or hunter (yes, in wrath, despite the in wrath). Armor class may not have too much bearing on how we play the pve game outside of tanking, but its a distinction that still can't be ignored because it IS restrictive.