What are the various item colors, and what do they mean?

Do the colors of items represent anything other than rarity? If not, what is the breakdown for how rare each color is respectively?

The item rarities in Kingdoms of Amalur are very similar to the item rarities in World of Warcraft, or most other MMORPGs.

According to the in-game manual, the rarities are:

It's implied that the Gold (set items) are considered the most powerful items in the game (depending on how many pieces of the set you have), mostly because the more items you have equipped from that particular set, the more powerful each individual piece becomes the more powerful the set becomes.

In addition, the higher tier of armor, the more bonuses you receive.

As opposed to an Infrequent piece of armor.

The item sockets, in some cases (depending on your Sagecraft), can make an Infrequent item last a surprisingly long time in comparison to some Rare or even Unique items.