I think the
final level of custom enchantments being better than the unique artifacts you can find in the world is fine, because making your own overpowered bullshit to break the world is more or less fundamental to the series at this point, but at the very least it should take thought and effort to make broken items. Until endgame, artifacts should be the most powerful things you can find, and not drop off in use.
Smithing is something I am for in theory, since otherwise Armorer feels like a chore skill warriors only take to avoid getting caught out. The problem is that Skyrim pushes everyone to grind smithing/enchanting, which turns it back into a chore. So give players who don't want to grind it the option of paying NPCs in the world to craft and temper gear for you for a shitton of gold and a few days wait; Honed Metal is a mod that does it this way and it works well as a gold sink. You could even tie Master-level crafting services to high level quests as a reward. There are also mods that combine weapon quality in with durability so weapons can still degrade over time, I would personally have weapons get a chance of breaking below a certain percentage of their maximum durability, and bring back repair kits to use in the field while upgrades can only be done in town.
The Rueful Axe sucking is the point. You did the deal the way Clavicus wanted, the Daedric Prince of shortsighted bargains.
Unrelated but I always thought the portrayal of Vile in Skyrim sucked because many of the 'deals' he makes aren't deals. He's supposed to be a Faustian bargain type who tricks people into signing bad contracts which seem good at first, but only benefit him. Him originally selling the Rueful Axe as 'a cure for lycanthropy' is only true in the most stretched sense, it's outright deceptive rather than taking advantage of short-sightedness. That's the difference between a Faustian devil (sells you a cheap second hand car without outright telling you the mileage) and a Genie (gives you a cheap car but it's actually just a carbomb). Compare to the story of the Masque which
did do what the person he gave it to wanted (hide her disfigurement) but ultimately caused her to get exiled.
But the worse one is him saying that the vampires in his shrine were begging for a cure, so he allowed you to kill them. First of all, that's not a deal, or if it is then we aren't told what he got out of it. In fact, it results in the death of a group of his immortal followers when he apparently has very little power left, which flies in the face of him generally scheming for his own benefit. Then there's the same problem where he isn't taking advantage of something his followers agreed to, he's just wildly stretching the terms. And you would think
followers of Clavicus Vile of all people would've made sure to pin down specific terms with the guy. This could've been intentional since he's missing Barbas, like maybe Barbas is the half that makes his trickery more sophisticated. But in that case the deal with the Rueful Axe could've been a proper Faustian deal to contrast with the cheap trick he pulls on the worshippers and show what losing Barbas actually meant. Reusing the same 'you thought I'd give you a cure but the cure is murder' trick twice just comes across as lazy.