The purpose of her bracelets are to be a focal point of ambiguity, so that they can kill Ares in one movie but are merely defensive in the next. It's so refreshing to see that her inconsistent power levels from the comics are well-reflected in the movieverse.
I saw WW twice in the theatres, and my sister wants to watch it again this week. I don't remember exactly how her fight with Ares went down (except that it was anti-climactic...) but I think her bracelets have the ability to absorb and redirect to some degree.
I was only kind of on board with the Azzarello route. There is something kind of cool to seeing her remove her bracelets and all of the sudden elevate to a new power level. The problem? It just ends up raising the question of why not just do it all the damn time? What's the downside of removing the bracelets? I think that's a question can be asked for most comic book superhero questions. Why fight like a bunch of scrubs when there's one clearly optimum attack that you can spam for maximum efficiency/damage?