Physical Defence= (str points x total physical reinforce+total physical defence)
Magical defense is similar but you put INT and mag instead.
so yeah it goes into the damage and defense calculations.
Reinforcement on both weapons and gear is more important than phy/mag attack and phy / mag defense; because they are base values. Obviously you would rather a higher multiplier than a number you just add on to an equation.
Here is an example that proves that:
Magical Attack = (INT Points x Magical reinforce + Magical damage)