What is the most kosher way to reduce the inventory of all merchants in the game? For example, to prevent Blacksmiths from ever selling Ebony or Daedric gear?

I've read a lot of descriptions of good, cross-mod compatible ways of *adding* items to vendors without overwriting other mods that do the same thing, usually by putting something like MerchantContainerLeveledList.AddForm(myNewItem, level, count) in a script. But in this case, I want to *remove* (or replace) the default inventory of a vendor without interfering with other mods that may have added things.

So far my only idea is to override the entire merchant chest or relevant leveled lists (like they say not to do when adding things, exactly because only one mod can do this at a time) and just trust that other mods that add items are doing it the kosher way with scripts, and will therefore add their items to my (overridden) container/list via scripts at load time.

Does this sound reasonable? Will it even work? Is there a better way to do it?

You would probably have to edit their vanilla levelled lists. Because other mods that add things to those vendors are set up to be compatible you shouldn't run into any problems there. You will experience clashes with other mods that similarly strip out certain items from their lists. This isn't a huge problem because any number of mods that accomplish similar things are likely to clash or overlap, it is up to the user to determine what is best for them.