I know the title is a little iffy sounding but currently Lethality shows how much Armor it's negating Serrated dirk offers 15 Lethality and in the tooltip, it shows it's negating 15-18 (I don't remember the exact number) Armor.
I think this would be an awesome Idea for a magic Item, like 
to show how much magic resist it's negating.
+15 magic penetration. That means you penetrate 15 magic resist.
Dude.
15 Magic penetration means you ignore 15 MR.
There is no scaling on that, unlike 
items.
magic resist is always reducing mr by the amount it says it never scales,
Ah. The issue here is that Magic Pen and Lethality are different mechanics that SEEM like they should be the same. It's a little unclear, so no worries. :)
Magic Penetration just gives you the face value at all times. If it says 15, it ignores 15 points of magic resistance.
Lethality actually works on the following formula:
Listed Lethality Value × (0.6 + 0.4 × your level ÷ 18)
As a result it's exact value varies based on your current level.
