Reflect Damage FTW :P I can usally handle 4 guards beating on me. Though if I have room I'll often times kite them.
The best is doing assassinations with it on. I killed the female guard chick in lizard town inside the barracks. Put the hood on, killed her, took off the hood, and by the time the guard got to the room he didn't know what was going on and I walked out :P