Been playing this for a few weeks now and I'm seeing some really unexpected opponents popping up in the AB2 arena. So I started wondering how the matchmaking works. Is it live, or am I playing someone else's persona, or what? 

I'm inclined to believe the latter. I mean, the gear choices for my opponents seem totally random. E.g. some players have a bronze slingshot but half their birds have no hats on. Also during a match I sometimes see them having two of the same card (eg 2x chuck) lined up, which should be impossible.