Does the simulator factor in the proc from Dragonwrath’s effect?
No, it only factors in procs that work for level 120 characters.
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It’s proccing at 115 
One would assume it would have stopped working prior to that…
It will stop after 115. Legendary items work up to 115.
From what I’ve seen, that only applies to legion legendaries…
Maybe so, but this old item isn’t going to be relevant for 120 characters, so we don’t rank the effect.