The problem with smithing is that it doesn't level naturally. Once you make and improve what you can at any given point you can only improve it further by crafting useless junk you don't need or training. There needs to be a way and a reason to purposefully keep using it, then that can be made the focus of the skill progression and it can be balanced properly.
One way to fix this would be to reintroduce gear degradation. If your gear slowly dropped from legendary to epic to flawless etc., and you had to then repair it at a bench with the proper materials (which would be a lot better than Fallout's "bang ten guns together to make one good one"), and doing so boosted your smithing skill, there'd be a natural way for the skill to level. BUT that wouldn't effect balance at all, it'd just save people some grinding (or maybe just make the grinding a little different, depending on how you look at it.) The problem isn't that the skill can be power leveled, its that it provides a huge damage/armor boost that isn't even close to accounted for by the increase in enemy level that raising the skill causes.
People don't understand isn't enchanting or smithing the problem, and reach the max lvl don't make the game more easy, is when you reach the cap of armor (576) and the cap of resistance magic (80-85%), then the game become easy, but is a problem of enemy can't pass trought this cap at master difficult too, the enemy simple don't do enough damage for become a problem, bethesda forgotten to give to us challenging enemy when we reach the cap.
If ppl want reach quickly this cap with enchanting and smiting or we reach this with perk i not see the difference we always have svcking enemy.
This is pretty much it. Crafting a Daedric sword and improving it to legendary boosts your base weapon damage from 7 points (with an unimproved iron sword) up to 24, so it gives you about 340% of base damage. Using +weapon damage enchantments will give you +40% x 4 = 160%, so 260% of base damage. Your weapon skill will boost it by about 50% (so 150% of base), perks by another 100% (200% of base). And these four massive boosts get multiplied together, for a total of 2650% damage. Googling around, I found this table with bandit health values:
Bandit: 35 health level 1Bandit outlaw: 109 health level 5 Bandit Thug: 238 health level 9Bandit Highwayman: 318 health level 14Bandit Plunder: 398 health level 19Bandit Marauder: 489 health level 25So, it looks like bandit health tops out at 489, up from 35, so 1300%. Your weapon damage goes up by a factor of 26.5, enemy health goes up by a factor of 13. Higher level bandits also have better armor, but unimproved armor without any armor skill perks has little effect. Level scaling just doesn't keep up with the skills.