In 3.3.5, there's an AoE damage cap that most AoE spells are subjected to which limits their potency on very large packs of mobs.
On a large trash pack of10 or more targets, the damage of a spell like Blizzard is calculated by checking how much damage Blizzard would do on 10 mobs, and then dividing that over the total number of mobs actually present. Let's say each tick of Blizzard would normally hit for 2k. On 10 mobs, that would be 2000 x 10 = 20k per tick. So on a pack of 40 mobs, Blizzard would actually hit for only 20,000/40 = 500 damage per tick. That's the gist of the concept of the AoE damage cap. The issue you're seeing with Wandering Plague's lower damage is because whereas Wandering Plague itself is subjected to the AoE damage cap, the damage of your diseases is not, because your diseases being on several targets doesn't count as "true" AoE.
Whether Wandering Plague's damage should indeed be subjected to AoE damage caps or not is another issue of which I don't have much certainty either way.
You're seeing Death and Decay do crap tonnes of damage no matter the situation because unlike Blood Boil and Wandering Plague, Death and Decay is not subjected to AoE damage caps either, just like your diseases. The same goes for plenty of other class mechanics that involve leaving some kind of damaging aura on a targeted area on the ground (Consecration, the periodic damage components of Flamestrike and Explosive Trap).