As a DM, if I was using the magic item pricing rules or Xanathar's buying an item downtime activity, I'd bump the moontouched sword up to an uncommon rarity.
It just strikes me as weird - as a LotR fan - that glowing swords are common.
It's not that glowing weapons are rare in Middle Earth.
Enchanted weapons are.
Through the entire series, there's only a few "special" weapons: Glamdring (Foe-Hammer), Orcrist (Goblin Cleaver), Sting, Anduril (Flame of the West), the Bow of the Galadhrim, the four Barrow Blades. It's not clear if the bow is enchanted or just well made, but the rest are all enchanted in some way. Glamdring, Orcrist, and Sting lasted too long to be anything but enchanted. Glamdring and Orcrist were so old that
Gandalf wasn't familiar with the runes on them (over 6000 years, IIRC). Both Orcrist and Sting glowed blue near orcs. The shards of Narsil remained razor sharp and unblemished for the whole of the third age (~3000 years), and it was said that Anduril "shone with the light of Narsil." The Barrow Blades were given to the halflings by Tom Bombadil were forged to fight the Witch-King of Angmar, and in the novels it's Merry's Barrow Blade that breaks the spells binding the Witch-King's undead body to his will, enabling Eowyn to kill him.
So, Orcrist and Sting can glow for certain when they detect orcs. Glamdring is supposed to as well, IIRC. Anduril
always glows. The four Barrow Blades did not, as far as I can tell. So half the magical weapons glow, and the half that don't are basically the high production blades made to fight the undead.
In D&D, however, magical blades are fairly common. You're pretty guaranteed to find at least one during your adventures, even if you're using the DMG's loot tables. Seriously, you spend a month rummaging around the wilderness digging through dark caves and a few dusty old tombs, and you'll come home with a cartload of coin and two or three blades that won't rust and glow like a campfire. In previous editions, fully 30% of magic weapons would glow. That said, nearly anybody can get a blade with
continual flame cast on it. Looks nice and intimidating, too.