So I farmed Dr. Mercy for about 20 kills until he dropped Infinity but when I picked it up the damage was 60!? What? I am at level 27 and rolling around with White Death dealing 786 damage and Mick Zaford's revolver "Maggie" (I miss Steve, Hi-yo!) doing 103x6 damage, so why such a weak number on the infinity? Every other orange weapon I have received has seemed adjusted to my current level except the infinity, could someone explain why the damage is so low on that gun and how I could get one that kicks more butt? I am playing on the 360 so any PC magic is probably out of the question.

Weapons drop at the level which the enemies are. So if you were to go farm Knuckledragger you would get a level 2 weapon. This is why people shouldn't farm until they finish the game a second time, when all enemies scale to level 50.

You definitely shouldn't spend any time farming until you're at level 50. Even if you found an amazing Level 27 Infinity, in a few hours of gameplay when you've finished the game and are on True Vault Hunter mode, that pistol will probably be useless.