Remove bags from merchants. The market is in game, give crafters some love. There's no reason to craft/sell bags on the market when you can go to a merchant and purchase a 20 gold sack. Also: Some serious potential content in bags and magic/enchanted bags with weight reduction or something of the like capabilities.
All the merchants do is keep a cap on the market price. They should raise the merchant cost across the board but, at that point, you may as well remove them like they did with arrows. They're not consistent.
if they did make bags cost 500 per and removed them from the loot table then people could def sell them with plenty of room for competition and profits, not to mention a reason to use up some leather that stacks up over time, I have soo much that I never use