Selling weapons and armor are kinda hard indeed especially since most people dont have the kinda money to buy a "magic sword" and settle for a normal sword instead.
Since adventurers are supposed to be rare, at least in my world they are, i'd say that about 0.1% of the population become "partially successful" adventurers each generation, counting out 50% that are either too young or too old, thats about 1 person for the few small villages of my world, and 25 people from the capital. Finding those 25 in a city with 50.000 people can be rough. Either way the important part is that there aren't enough adventurers to make magic item commerce available.
Elves and Dwarves are a different matter, all Elves and Eladrin have player classes, though most of them don't have many levels and their entire population are of only a few hundreds. Dwarves have very powerful kingdoms and many warriors with magic items, but their kingdoms are mostly isolated and they are constantly fighting hordes of orcs or giants, and other threats, thats because when mankind expanded a big part of the monster races were expelled to the less hospitable environments, especially mountains. Dwarves do sell good quality equipment, mostly non magical though, and they trade mainly with human nobles and churches. There are a few rock gnome merchants powerful enough to travel and sell equipment on their own, but they are generally adventurer agents on information gathering assignments (aka spies).
Obviously there are other groups of people who have the resources and the means to own magic items. Those are all the militaristic groups of the world. Churches, Nobles, Cults, Armies, Organized Crime, powerful Mercenaries. The wizards of the world are all divided into doctrines, a few powerful wizards who have their set of pupils and tend to work closely with other groups toward mutual goals. They are all part of a guild and monitor the production of magic items very closely to make sure that to those who get them don't end up conflicting with their interests.
In a sense, since magic items are the equivalent of power, if there is a magic item available, it will be put to good use, a king will want his most skilled and trusted commander to have it.
That could be seen as a very high demand for magic items indeed, but the fact is that people who have items don't want to part with them. The group could sell their equipment for full value if they are diplomatic enough, or even a little higher if they bluff well enough (not too much).
But then they wouldn't easily find a way to buy anything better. Opportunities will come eventually, if they work for a church or for a wizard maybe. But those are the exceptions.
Most of the time, their best bet to get better equipment is either adventuring, or making their own. I have a house rule that will allow them to make better items with some risk involved, they must collect enough energy to try to make a better item and roll high, if they don't roll high enough, the excess of energy is wasted.
Basically, to me and my world, magic items are very rare, and very valuable, they are magical after all, they are supposed to be special.
The best part about 4e is that the NPCs don't necessarily need to have magic equipment to be powerful, all they need is a few special abilities that come from themselves and the rest comes from their inherent Baddassness. Such as the boss fight my group will face next, an Elite Orc Shaman with 22AC and a measly leather armor
![:]](http://www.enworld.org/forum/images/smilies/devious.png "Devious :]")
