I do make swords, or at least everything but the blade itself. So I make the guard, pommel, grip, and scabbard, which I carve from wood and cast bronze fittings.
I do not make Japanse swords. I won't touch those, because I feel that those are a thing of their own and are simply out of my style and league. My weaponry is Chinese, the jian and dao.
I would love to learn to make blades, but currently I don't have the room for that kind of mess. So for now I content myself with hilts and scabbards, and I enjoy it quite a bit. Actually, just before I logged on today, I was setting up some molds to cast some bronze pieces for a sword I am working on.
For me, making the weapon has been very insightful. As someone who practices with my own weapons, I have a very clear idea of what makes for a good weapon, the different elements that make it feel good in the hand, such as balance and grip and such. Getting to know the weapon on that level, and understanding the work that goes into making a serviceable piece has given me a tremendous appreciation for both the weapon and the training that goes into using it. I do feel that I have a stronger connection to the weapon than they typical kung fu guy who is content to play with the tinfoil toys that are so prevelant in Chinese martial arts today.
As far as quality of steel goes, there are some tremendously high quality production steels that can make for excellent blades. You can acquire bars that can be ground into a blade, or use a sort of hybrid of forging and grinding for those who believe the process of forging improves the steel. I think that the tremendous forging techniques that the Japanese perfected (these techniques were definitely used by other cultures as well, including the Chinese, but I think the Japanese brought it to the highest level) were necessary in order to improve upon the quality of steel that was readily available at that time in history. But with modern smelting and production of specialty alloy steels, I do not believe it is necessary to use the old techniques in order to get a very very high quality blade. That being said, I have a tremendous amount of respect for the old methods, and I'd love to learn to forge a blade vs. grinding one out. I'm just saying that the modern methods that are much faster can also produce a very very good blade.
I think it is easy to tell when someone makes a sword, but they do not train with them and know nothing about their use. A friend of mine is a knife dealer, and he has been pestering me to go to a knife show and convention that he attends every year. So a year ago I showed up with him for a while one afternoon. I saw a number of swords that different people had made, and many of them were absolutely atrocious and completely unuseable. One had a big antler piece for a grip, which would have been cool except that it was far too thick for a comfortable grip and it curved into an odd angle that made it impossible to hold comfortably. Another person made a sword with a carved jade handle and a big machined steel guard. The grip was also very thick and uncomfortable, but it was also very very heavy. Not to mention that jade can be brittle and crack, so if you tried to use the weapon you might destroy it in your hand. The guard was also very problematical. It was machined into a fancy shape, that had sharp corners on the grip side, where you hand would rest against it. The weight of the hilt probably added 4 or 5 pounds to the weapon, it was so heavy it just couldn't be used.
These pieces were clearly made by people who do not understand how a sword is used. They were probably designed on a fantasy idea, and the reality just did not make for a serviceable weapon. Lots of work went into these, but I figure if you are going to put the work into it, then it ought to be useable. Put the time into makeing something with a good design, good craftsmanship, and good durability so it will hold up. Don't get fancy at the expense of serviceability.
After going to that show, I suddenly realized that my own work is really quite a bit better than most of those, and I am sure it comes from my training background.
Sorry for the long post, but you hit a topic that is rather close to my heart.
thanks!