The XP cost is because the caster is creating a special material with special properties through the use of magic. This is a permanent item that can be further magicked. By requiring the caster to have the skill to make the item; I encourage specialization for more than combat skills. Since their primary stat is Intelligence, wizards can afford to spend points on extra skills (I realize that this is an 8th level spell requiring at least an 18 Intelligence to cast). Sorcerers have never been played IMC. I don't know why except that my players have all been playing since 2e and wizards get spell levels faster and usually have a much bigger choice of spells when memorizing.
This also goes to the means of specialization IMC: fighters have PrC's that require lots of feats and can weild a variety of weapons; rogue's PrC's require lots of skills; Clerics specialize in some area of their special abilities (healing/inflicting, turning/rebuking, combat/support, summoning, or artillery); wizards require strange knowledge and/or a few (strange) skills to specialize with PrC's and/or spells.
I've built PrC's, spells, materials, and even a class or two to maximize their choices and ability to specialize. It is useful to note that almost all spellcasters IMC have made up some of their own spells; adding to the campaign. Several characters (who have since gone on to their final reward) have left a legacy of scrolls with their personal spells on them that I can occasionally add as random treasure. They had to spend the XP to make them though. Those players are still around and really enjoy finding a scroll made by one of their previous characters containing a spell their new character would never have thought of but can find useful still.
Should a material object; when made of magically created material not require an XP cost? The item will last a lot longer than any other spell. If made into armor, a weapon, or a shield; it will probably be further enchanted to give it greater abilities (other than immunity to rust, dispelling, and magnetism).
Ciao
Dave