Are you sure it happened like this? An Orc Young is not supposed to decapitate people with 300 head armor in a single hit, and the Decapitate skill is not supposed to increase damage vs. armor, only vs. hitpoints. Decapitations (with or without the skill) don’t trigger an insta-kill, it’s the other way around; if a character is killed, there’s a chance this is portrayed with a fatality of some kind depending on the skill that killed him.
So, if what you described did indeed happen like this, it’s a bug. The more information you can give about how to reproduce this, the easier it’d be to fix this, since we’ve never encountered this before ourselves. Thanks!