When I try to use shield to further my defense, It does not add to my armor rating like it should unless i unequip some sort of equipment I am wearing. Is this a known bug? I am using the unarmored skill and finding a solution would help.

I think that's normal... been a long time since I used a shield spell so I might be wrong.
Because it's a spell effecting you, not actual armor you're wearing.

edit: It is a known bug, yes. The MCP might fix it.

Since you're using Unarmored be sure you have the Code Patch installed, otherwise Unarmored is broken.