Loom points are worth 750k right now, while junky, low demand, high supply +3 items (danish, arbalast, bec, etc.) are selling for 1.2 million to 1.4 million. Also factor people's unsellable gimmicks they regret like +3 torch, club, dagger).
So once you factor in this 100-300k price differential, then add in more factors like convenience premium (vs patient market selling), plus saving on 5% tax, and I could see the blacksmith conversion easily being worth 400-600k to someone.