They wear thin bands to make their muscles stand out and look bigger! ;)
According to the New York Times article (see related links below), the armbands are nothing more than the current fashion trend with the purpose of showing off their upper arm definition. Wearing the armbands (in many cases wristbands moved up to the upper arm) has no medical or performance benefit.
That certainly is possible. However, the shoulder pads that football players wear are made to come down over the upper part of the chest. So a player could possibly have the wind knocked out of him by a hit to the upper chest but that would be more common with a hit to the lower ribs or midsection where there is no padding. Click on the 'Football Player's Padding' link on this page to see a picture of how a player looks with all of his padding on.
If you are looking at the jersey it is on the upper right hand side, if you are wearing the jersey it will be on the upper left hand side. This is true for every NHL team with the exception of the Detroit Red Wings, where the "C" is in the upper left hand side if you are looking at it, and the upper right hand side if you are wearing it.
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