The crafting skills in many RPGs suck, this is a fact. It's simply because you're supposed to be playing as big guddamned heroes, not smiths; you don't get all those feats as a fighter just to whittle away corn-cob pipes for profit. Making this a big part of the game could be problematic in some way, but it's workable with the proper modification.
As you wrote, cutting costs to silver and reducing times to a tenth really does speed things up and could work well for some things, but what happens when I want to make ball of gold and my identical twin wants to make a ball of silver, same size and all? They'll still have their item done faster than mine, no matter how you slice it. A fix for this problem is to account for the size and type of item!
A 'medium' object in terms of crafting a weapon might be a short or longsword, something fairly simple. The larger the item to be crafted is (a greatsword), the longer it will take because reasons. But the same is only half true when looking at the opposite end; a dagger is small and should be relatively quick to make, but an intricate gem-inlaid ring will take much more time putting together than an amulet to Pelor.
Really, the only thing to do is just BS it; pull numbers out of your butt for what seems reasonable. Players won't (or shouldn't) be so anal they demand specifics so long as you generally keep the crafting times of similar items close or equal.