Early to about mid game you should try to just trade with full durability items, as they are worth more. At the start, there should be enough crappy (durability 1/1) or broken items that can be traded for potions, etc (much of the better equipment you find has to be stashed until you reach merchants with more gold or inventory items anyway).
If you can repair equipment yourself you can get more for it; IIRC (might be thinking of a different game) with more expensive items you may even come out ahead if you pay to have an item repaired and then sell it. I put 2 skill points into Repair and found 3 items with this bonus, which I used to batch repair stuff (I never paid for repairs, since I am cheap).
As the game progresses, gold gets easier to come by. If you are not buying a lot of charms or spell books, and don't want to maximize your profit just on principle, then the need to repair first to get the most out of loot will be reduced.
Good to know. Thanks for your help. =)
