Wizards channel their spells with toughness. Their Willpower is reduced by x for each x of worn armor.
The channeling part (at least on p31 for humanoids) states that a wizard can use up to their total characteristic value when channeling a power.
Since armor is a Toughness enhancement, does wearing more armor allow for an increased amount of channeling? E.g. a wizard with toughness 2 can channel for 2, but when he's wearing medium and thus has an armor bonus of 2, does that mean he can channel for 4?
Negative. You are using the base Toughness characteristic, sans Enhancements.