Assuming the text is correct, can Waterfall Cloak be used to remove a Burn token from any object, or only from your mage? No target is specified... but given the cheap cost and that it is an Equipment, I assume you are restricted to removing a Burn from your mage only. Otherwise, this is probably the best piece of Equipment in the game for a Druid!
*edit* Also, Waterfall Cloak + Chitin Armor gives you Acid -5. That's some pretty amazing anti-Corrode tech: Devouring Jelly or Spitting Raptor needs to roll a 10+ for 1 Corrode, and Acid Ball needs 6+ for 1 Corrode and 10+ for 2 Corrodes.