District Drop Rate Connection?

Is there any known district drop rate connection that increases or decreases drop rates based on amount of ppl in districts? Or is it all just based on random dumb luck?

Drop rate doesn't have anything to do with districts. It has to do with the number pf real players in your party when you are in an explorable area. Drop quality is also influenced by what type of area you are in: in beginner areas, you are less likely to find a good gold drop than in areas near the end of a campaign.

Also check the wiki on drops and loot scaling.

Technically it also has nothing to do with # of real players, it's just that if it gets assigned to a hero/hench you never see it drop.

Nah, nothing like that. Just randomness