mobs like zombie's picked up items and equipped, armour.
They would also prioritise the pickup order. Block, tool, weapon etc.
even though the mob has CanPickUpLoot:1 set, it no longer picks up any items if summoned in 14w04, mobs summoned in pre 14w04 do still pick up loot in 14w04 till the upper limit is reached (diamond armour, diamond weapon)
UPDATE-----
Since 14w04 the syntax is now CanPickUpLoot:true and no longer CanPickUpLoot:1
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here is a pre and post 14w04 gifycat showing it in action... in the second part you can see the mobs summoned in 14w03 still pick up loot but the ones summoned in 14w04 do not.
Have you tried canPickupLoot, CanPickupLoot, canPickUpLoot or CanPickUpLoot:true?