When they shift forms. Does it turn into the fur or scales for trolls? Does it disappear into the twisting nether? I need an answers damnit!
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Well if they are lady druids their clothes usually end up on my floor… heyooo! 
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Considering that worn armor/weapons increases the armor and power of your forms, I’d guess that the armor is incorporated into the form’s fur/hide… somehow.
Probably with a little of this.
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Druids are buck naked at all times and the appearance of clothes is just a glamour magic
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I sometimes like to imagine Druid shapeshifting as wearing a hyper-realistic fursuit made of natural-spiritual energy. The clothes are still there, just hidden under the suit.
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Clearly they go to into a pocket dimension
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You don’t want to know.
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You know how Bayonetta’s outfit is technically her magic hair?
Same.
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They stay with you in Transformation like pretty much when you shift forms into animals. Your Armor Stays with you.
they go into z-space
I hide them behind a nearby bush and come back later when I’m done.
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They’re soulbound, not hidebound.
Clothes!? Where we’re going we don’t need clothes
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I always imagined them as fusing together into the body of the druid. Might be because I’ve been re-watching Attack on Titan, but I think the animal form just encases the user and whatever they’re wearing at the time.
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I think I see it kinda like transfiguration in Harry Potter, though I may be way off.
A thing is transformed into another thing. The things that were on the other thing are irrelevant, as the thing is now a different thing 
We don’t need to worry about where the Toucan’s beak went when he got transformed into a water goblet. Nor do we need to worry about Malfurion’s underwear, and where it went when he turned into a bear.
The entirety of him just turned into a bear. Later, it’ll turn back into Malfurion in his underwear. And meanwhile we can all sleep at night knowing that Malfurion’s bear form isn’t wearing a really tight thong.
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They go the Grummel that lives inside every druid, who presses and fold them to crisp perfection.
In their butt.
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They turn into those decorations on the animal forms. Zandalari have like a cape or something in raptor form.
According to lore, clothes and most objects on the druid’s person are absorbed into the fur and the form itself. Unless the object is corrupted by some kind of outside influence, in which case it will not shapeshift with you and will instead be found on the ground, such as Broll Bearmantle when he attempted to shapeshift with the Idol of Remulos.
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… [PTSD intensifies]
Ah yes, nature’s grummlepack.
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