Varrdy said:
It's not fake so much as scripted. In order for it to be believable, contact has to be made and just because someone stomps during a forearm, doesn't mean it don't hurt! It's all about managing it and taking a "bump" in a way that it looks realistic, might hurt like fuck, but doesn't do any real damage. In Foley's first televised match, the Dynamite Kid hit him with "a clothesline so hard he couldn't chew food for a week".
I'm trying to avoid becoming too overly enthusiastic about it myself, but reading a lot of the responses here makes me want to scream out "ASK VADER'S OPPONENTS HOW FAKE WRESTLING IS."
You are right though, it is more scripted than all out fake, though a part of this depends on the performer.
Some guys wrestle stiff and old school, like Vader.
Vader would fucking hit people. I mean you see how WWE wrestlers today make super exaggerated movements and what not, and they're connecting, but it's barely a love tap, relatively speaking.
Vader was a football player and didn't give a fuck if he hurt you, especially if you pissed him off in-ring.
Sometimes though you'll see someone who's not on their game or botch a move and it looks very obviously fake. It all depends on the skill and style of the wrestler.