Okay, I've got another variation on my previous ideas, but one which shouldn't require you to carry around dozens of hammers:
Each use of a Repair Hammer repairs some amount of an item's max durability. It's late and I'm tired, so I haven't decided how much it should repair exactly. 5/10/15/20% of Max durability? Not sure...
Repair Hammers start out with 100 durability. When you Repair, it consumes the charges of the Repair hammers in inverse proportion to your Repair skill:
At Repair 1, a hammer consumes 5 charges per use (20 uses).
At Repair 2, a hammer consumes 4 charges per use (25 uses).
At Repair 3, a hammer consumes 3 charges per use (33 uses).
At Repair 4, a hammer consumes 2 charges per use (50 uses).
At Repair 5, a hammer consumes 1 charges per use (100 uses).
This means that you can transfer hammers between characters without having to do complicated calculations and checks, but the one with the highest repair skill will get the most out of them. Because even Rank 1 hammers get 20 uses (instead of 1), it means you have to carry fewer hammers with you.
The exact numbers may need tweaking, but other than it going against Gyson's insistence on keeping a punitive red-line, how does the general idea sound?
So.. let's imagine that "red-line" they currently have in place is removed (and, of course, the permanent durability loss). What you're essentially creating at that point (with this design) is a skill where more ability points spent = more savings via Repair.
How meaningful that is depends on how easy money is to come by. Since MOBs don't respawn in Divinity, that also means there is a limit to the amount of gold available, and thanks to the RNG some people can empty every container in a town and never run across a gold piece. Tilt that ratio too far one way and the potential savings aren't enticing enough. Tilt it too far the other way and everyone needs to get the skill.
The other thing is that NPC repairs have to be more expensive than a player repairing his own gear (otherwise, what's the point), so that has to be figured into the balance as well.