I used the Potent Converter on a Refined Xiocite Keshian Jerkin, and in return the item was no longer Refined. It's got potency now, but it doesn't seem right that it would return the item without the same quality of stats.
In a tower near the dock in the Phantom Seas, there's an NPC that sells gems and some other miscellaneous items; including the Potent Converter. It takes armor from AoM that has block on it but no potency and converts it to a fighter only piece while adding potency.