I do like the idea. A little different, but what about weapons that use your own magicka as a source of power? Definitely a little on the overpowerful side, but maybe they could start to sap your stamina and then health if you used it too much.
Actually on second thought that might be a better idea for one unique weapon. Something Umbra like.
Draining the player's magicka instead of consuming charges is actually a pretty bad-ass idea especially since these weapons would probably be made and used by non-mages anyway. They could be scripted to require and consume 10 points of magicka for example.
I'd still like to put together something like Welkynd and Varla stones to be used in their creation though. That would be supported by Oblivion's lore as well. Since they've been uncovered and floating around for 200 some odd years since Oblivion it would make sense that they figured out how to better put them to use.
I imagine that will be difficult, but you can adjust the perk prerequisites pretty easily, making it behave as if its in a straight line.
*Edit - So you could make the perk tree work as if its a loop that only goes in, say, the counterclockwise direction.
A loop would work. You're a genius! Why didn't I think of that? lol. Starting with Steel, branching off only for the 5 ranks of Arcane Smithing, then going to Steel, Silver, Orichalcum, Dwemer, Moonstone, Glass, Ebony, Dragonbone & Daedric.