Divine Tyrfing (and all other damage reduction weapons/skills) work, as I just said, as a damage reduction. That means that they reduce the received damage by a certain %, but to know that % you need to know the initial damage first, and it can only be calculated if you know the Atk value of the attacker and Def/Res value of the defender. Which is precisely what Distant Def affects.
So basically the order is: Calculate initial damage (Distant Def is applied) > Calculate reduced damage (Divine Tyrfing's effect is applied) > Final damage output is inflicted.
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