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+spell damage is generally not used because such gear lacks in melee crit, which you'll want a lot of to keep Vengeance uptime as good as possible. That's also a downside to using Seal of Righteousness if you're heading the DPS route; Seal of Righteousness can't crit, Seal of Command and Blood can. Simply put: You want to minimize the chance to lose that +15% damage buff from Vengeance.
As for how Seal of Blood scales: Seal of Blood gets no benefit from any spell damage; and is basically as if dealing a normal attack that does 35% of your normal swing damage would, which also ignores armor.
Outside of Judgements all standard used Retribution abilities either scale best with attack power, or they scale equally from an equal value worth of spell damage and attack power. Auto-attack in particular shouldn't be discounted, since it's one of the larger sources of damage of any melee class, and auto-attacks only scale through physical stats.
That's not to say I'm not interested in someone trying it out, but I'd be surprised if it worked well.
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