Hmmmm. Well, on one hand, if you're going for a High fantasy world, there's no reason why a werewolf couldn't have armor and a jolly great-honking axe... of course, how he fits INTO said armor before he changes into a werewolf is another story, but I always overanalyze things like that.
Buuuuuut, if you're going for a normal world or a world where there's gonna be a bit of fantasy, sterotypicaly a werewolf wouldn't have clothes, armor, or anything else to speak of. He's just a damn big, powerful, and mean-as-hell wolf that walks on two legs.
That's just my opinion though... that, and I'm a bit late to the party. Whoops!
I would say Design 1 because it's more natural if it's in a more realistic setting. Sorta like Werewolf: The Foresaken by Whitewolf games. The geared up one I would think to be more of a civilization of werewolves themselves.
Personally, I like the 1st one the best! I guess I just absolutely love the classics. He looks very threatening. By far one of the best werewolf pictures I've ever seen. They should make all werewolves like that
The whole thing about werewolves is that it's a curse, they become feral beasts with no concept of humanity for a night, if you add armor it's as if you're giving them human intelligence the use such armor and weapons which is taking away that part of the curse and making them ridiculous. As much as I like the concept of a were using weapons and such, they stop being werewolves and start being really fierce anthro characters instead.