I must admit I'm not even halfway through reading this thread since my time is very limited (but not too limited to write this monster of a post, it seems), so it's quite possible someone has suggested this already, but how about limiting your incentive to sell your unusable loot or making the loot more of a story item than just a source of money? Below some completely random examples.
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For example you could see these little scraps of blue silk strewn around the whole world, and sometimes turquoise, and very occasionally green. When you collect them they all go to this one pile that merely keeps growing instead of taking your inventory space, and when you ask about it most people won't care/have a clue but some traveller/retired adventurer/dusty old book/grateful priest eventually lets you know that that material is some special spider silk, made in ancient times, tears easily but never decomposes, used to be quite a fad at some point in the distant history. And hints that it still might be, somewhere.
You could usually come across those scraps, say, at the same rate than you come across rings in BG2 (not that I remember what it was), but it varies by the area, somewhat. And then you find a place where the stuff is just everywhere. When usually you might find a few coins in almost every corpse and a scrap of silk in every fifteenth one, now it would be the other way around -- gold is really rare, and silk in abundance (especially in the stomachs/pockets of larger monsters that stalk the roads). And when you get to the town/village/whatever you notice that just about everyone is wearing those scraps in their person -- stitched to their clothing, made into scarfs, hair ornaments, anything. And there you learn that the silk is supposed to bring you luck, and you should always wear it on you.
Well, by then you have found enough remains to know this doesn't sound very likely, and have probably also carried the stuff around for a good while without noticeable boost in your luck, so you feel a bit cheated that you have bothered to carry it around at all even if it doesn't really weight anything. But then you notice the old adventurer at the tavern who *doesn't* wear silk, and go ask her about it, and she asks in return don't you know how much they pay for that stuff in area X? So you keep collecting the stuff and go there, noticing that suddenly the silk is really, really scarce in the nearby areas, and then find out the gal was exaggerating a bit -- you won't get even one coin per scrap -- but you also notice there's a guy whose clothes have a very distinct and familiar shade, just like he had had it all made from the silk. And when you talk to him you learn that you can have the stuff crafted into clothing in
some weaver shop, or if you have talent in handcrafts you could get patters from this guy in this private club, and by the way they also buy those crafted clothes there.
Then it turns out that whether you craft them yourself or have them crafted by someone else the clothes don't really get that good price (except the rare green ones, possibly) -- but if you provide enough of them you might get an invitation to the exclusive club. Can't get inside if you aren't dressed properly, of course, or at least you'll get a very grudging reception, but if you do dress up you'll be really quite unprotected in the meanwhile, so you might wish to invest in some stealthy means of defending yourself and possibly leave a couple of your less sophisticated group members outside both to serve as a guard and to keep them from insulting the members. Might be that you should veto even yourself from going and send someone else in your stead, if you have someone else who fits the profile better and is worth your trust. And depending on how well you or your representative get along with the various members and whether you'll fill their possible side quests in an acceptable manner you could end up with various kinds of benefits -- an unique item in some fabulous colour, perhaps, or goodwill of the town guards who will look the other way as long as you aren't raiding the houses of the members (easily recognizable through some symbol, or contents of the place), or you could find a buyer for this completely useless set of turquoise armour you've had lying around in your stronghold because it just has to be a quest item, and so on.
In fact you might be even collecting those weird and useless sets of armour (parts of which you might need to buy or craft/have crafted to get the sets complete, and sometimes replacing an original but badly damaged piece might be beneficial), and find someone who would be interested in displaying selected pieces of your collection in some other elitist society's function -- you might not get that much money out of that either, but your reputation would spread and you would get more deals like that, with another set of benefits as a carrot in the end. And perhaps one of the armour enthusiasts would try to swindle you, and you would have to choose how to react to that with different kinds of consequences. Then perhaps another weaselly-looking person tries to make a deal with you afterwards, and you suspect the results will be the same but you go for it anyway, and get something special extra for your troubles since he's having such a hard time getting anyone to lend their collection to his functions.
You might even hold some armour fair of your own in your stronghold, with all your displayed armours guarded and securely booby-trapped in various ways in case of thieves. You might even present older sets of your own armour, along with stories of your accomplishments while wearing them. Not to mention your ring collection where every item also has their own story, even if you had to make up most of it yourself since the corpses you found the rings from weren't too forthcoming with information, but no matter, everyone loves a good story, right? As long as you don't embellish too much and get called on it, that is. And if you are of dark inclinations yourself, you might have yet another, secret collection that has that elven-hide armour and a necklace of small finger bones and other dubious items, and gain nice pieces of information/influence/contacts with the similarly inclined collectors.
Of course if you go and show it to the wrong kind of person you might not like the consequences...
And if you don't want to go through all that trouble you can just sell the silk and the useless bits of armour and the cheap rings at very bad price, and make do without the extra items and other helpful things you can earn from going through the guests -- but your main merchant will grow very fond of you, and give you some special guests of his own as a reward, and perhaps you'll find yourself very tight with the merchants of that area in general. And if you want to have it all, you'll really have to run yourself ragged trying to find enough silk and stuff for everyone, and it might not be completely possible in any case since the merchants don't get
along well with the secret society of the fancy clothes (as they steal customers, even if they also buy most of the silk off from the merchants), but you can always try, eh?
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Personally I don't really mind being the richest person ever alive at the end of the game, either.