Simple question, I know when and how I get the Blades armor, the only thing I cant seem to figure out is what skill in smithing lets you upgrade it. Steel? Advanced? Daedric? The power of greyskull?

Take the armor to one the blacksmith tables and see what you need. It will show you at the bottom right of the screen. My guess would be steel and leather, but that is just my guess.

true enough, thing is I havent gotten that far in the story. I am just trying to figure out if I need to get to the advanced armor perk in smithing to upgrade it or if basic steel smithing will work. (or possibly some other skill). Once I know that I am confident I can get a hold of the materials needed.

Look and see what is required to upgrade it. I'm guessing that if it requires steel to upgrade, you just need steel smithing. Not positive though.

The katana's are steel I believe, so I'd guess same for the armor.

Here you go.... http://www.uesp.net/wiki/Skyrim:Blades_Armor

The gist is it needs a steel ingot to upgrade, but it has no perk associated with it. If I remember correctly the dragonsbane sword that comes with it needs a quicksilver ingot to be upgraded. Hope that helps! ^^

You can repair the armor without using perks, but you need Steel to improve the sword. Perks are only needed to create stuff or upgrade it even more. The one you may want to shoot for is Arcane smithing so you can upgrade any magic items (which requires the Steel perk first).

The big negative is that if you choose to follow the Light Armor side of the perk tree and reach Dragon, you cannot keep circling around and select Daedric (which supposedly gives slightly better than Glass quality, but weighs more).

Once you start collecting stuff with a bonus to smithing (bracers/gauntlets, rings, necklaces and potions) you may find that increasing your skill is way too easy, and creating stuff at the forge (rather than just improving) increases your skill even faster. If you choose to Enchant your own gear, the cycle of making better and better stuff gets truly amazing. After a while you cannot find any merchants that can afford to buy your stuff.

Sweet, thanks guys