The merchant thing could be somewhat similar to the boss fights. The player would need specific 'valuables' to purchase the merchant's special items. Since gathering gold, etc. can be relatively commonplace after enough game hours the 'valuables' could be retrieved only after extra dangerous tasks as outlined by the trader. The merchant's special items might just be components for crafting unique showpieces but not functional upgrades.
"Dude, look at this ♥♥♥♥♥♥♥' lox saddle!"