I do not understand how people roll need when wearing more powerful gear

For A → B to be a true statement, B must be true when A is true. This is a conditional statement

e.g. “If a shape is a square, it will have four equal sides at right angles to each other”.

We can start with “If transmog was intended to be used by a Need roll, a player should be able to roll Need on an item they can equip, and do not own at the same or lower ilevel”

You’re saying A is true.

Yet B is not in the case for a Paladin and an Agi polearm. The item is equippable.

Hence the statement overall is false.

“You may only roll Need on an item if your class can equip it and it is considered an upgrade. Having a certain item equipped or in your inventory will prevent you from rolling Need on that item if it is the same item level or lower.”

Thus, the item is not considered an “upgrade” and Need roll is not available. Hence, via transitive property … “transmog” is not an “upgrade”.