Hussar
Legend
Here's another excerpt from AD&D 2e I thought was interesting as far as this discussion goes...from the DMG...
Buying Magical Items
As player characters earn more money and begin facing greater dangers, some of them will begin wondering where they can buy magical items. Using 20th-century, real-world economics, they will figure there must be stores that buy and sell such goods. Naturally they will want to find and patronize such stores. However, no magical stores exist.
Before the DM goes rushing off to create magical item shops, consider the player characters and their behavior. Just how often do player characters sell those potions and scrolls they find? Cast in a sword +1? Unload a horn of blasting or a ring of free action?
More often than not, player characters save such items. Certainly they don't give away one-use items. One can never have too many potions of healing or scrolls with extra spells. Sooner or later the character might run out. Already have a sword +1? Maybe a henchman or hireling could use such a weapon (and develop a greater respect for his master). Give up the only horn of blasting the party has? Not very likely at all.
It is reasonable to assume that if the player characters aren't giving up their goods, neither are any non-player characters. And if adventurers aren't selling their finds, then there isn't enough trade in magical items to sustain such a business.
Even if the characters do occasionally sell a magical item, setting up a magic shop is not a good idea. Where is the sense of adventure in going into a store and buying a sword +1? Haggling over the price of a wand? Player characters should feel like adventurers, not merchants or greengrocers.
Consider this as well: If a wizard or priest can buy any item he needs, why should he waste time attempting to make the item himself? Magical item research is an important role-playing element in the game, and opening a magic emporium kills it. There is a far different sense of pride on the player's part when using a wand his character has made, or found after perilous adventure, as opposed to one he just bought.
Finally, buying and trading magic presumes a large number of magical items in the society. This lessens the DM's control over the whole business. Logically-minded players will point out the inconsistency of a well-stocked magic shop in a campaign otherwise sparse in such rewards.
I wonder, if just for a second, Mike Mearls wrote this in an editorial in Dragon how much Nerd Rage would absolutely EXPLODE from the collective heads of every world building DM out there. "HOW DARE THEY TELL ME WHAT I CAN AND CAN'T PUT IN MY WORLD!!!!" You would be able to power a small city from the heat of the flames that would erupt on every online forum dedicated to the hobby.
But, it's perfectly acceptable for the designers to dictate your campaign setting to you when it's done in previous editions.

As far as 4th lvl NPC's in 3e having magic weapons, well, by the DMG they probably should. I'm looking at the 4th level NPC's in my Dungeon magazine right now, and, yup, everyone over 4th has a magic weapon or armor. Imagine that. Following the NPC wealth by level table.