Breakage mechanic is a pretty complex thing - like all other physical phenomena when we try to model it scrupulously. I am by no means an expert of the field, and especially have much to learn in historical metallurgy, so although I gave a thought about the issue, but take everything I write with a grain of salt. 
Durability would be a nice feature indeed, but I’m sure about one thing: No HP (or anything like that) for weapons, like as it is present for example in Dark Souls - I am basically okay with everything else, even with no weapon breakage at all, but HP is the worst.
Basically, metals can have in theory two different states and everything inbetween: either rigid or tough. I am saying “states” and not “properties”, because even a tough metal (I’m unsure if this is the correct term in english, when the material’s breakage surface is something like a pasta, and the energy required to break it is relatively high) can become under various circumstances (irradiaton, repeated bending, cold temperatures [steels of this time might not even need extremeky cold weather to do so, but I don’t have any hard data on hand] etc.) hard but rigid, so the suface of the breakage is crystaline.
What I am saying is that failure can’t only look like hollywoodish “Oh hey, look, my sword broke just in the middle of the blade!”, but I remember many bent swords from museum photos as well (the time frame, of course, is another question). That kind of a serious breakage may indicate material failure, like slag remains inside the material from the smithing, cracks, micro-cracks from the heat treatment or a thousand other things which I totally forgot about and probably less plausible, like hydrogen in the material.
People tend to believe too that when you throw the glowing blade into water, it will become amazing, but naturally, not every material can be hardened, and even if they do, results may vary depending on the initial parameters. We have to also keep in mind that the metallurgy of the era had simply less means of controlling and reproducing the same exact quality of the material itself, without any processing.
Lastly, I would also point out, that simply mechanics-wise (so pretending homogeneous material) almost any swords most critical point in terms of breakage is the connection of the tang and the blade, so this point, where the stress gathers up, when we add force to the blade:
Anyway, a bent sword (how easily it bends, it depends on the geometry of the blade also, of course) is easy to repair (but it’s material might stay the same, and the more flexing, the more possibility to actual breakage), a broken one not so much, but with a grindstone really you can just repair the edge - and even with a sword with a f*cked up edge is still dangerous enough to not simply downgrade its damage to half of it’s original’s.
Gameplay-wise as of creating new blacksmith’s wares, maybe Henry might have a freedom of selection between different material qualities from different locations, different mines, this and the simplicity or ornateness of his works could influence the prices, but it’s all just wild ideas and guessing without historical backing, and I doubt it will come into play anyways. My main point is still only: No HP for equipment! Rather a quasi-random (low) percentage of chance of some sort of damage that slightly goes up with heavy use. Or really, anything but HP.
I would like to make a shout-out for something almost no game handles at all though, and it is faaar more of an issue than exploding swords under a very short amount of time:
rust.
Yup! I would love to see rusting in the game, even with a simple(?) texture overlay. It doesn’t have to affect too much, but it could be a pain in the ass, as it is in reality, going out in the rain, and just after one day I have to clear all my sh*t again, because the longer I wait, the worse and deep it might get.
