Thank you! I'm glad you took the time to play a few times and try to piece it together.
I don't want to give definite answers in the comments to spoil it for others, but I do have reasoning for the Blacksmith's jaw that unfortunately I didn't have time to fully include in the game. He's suffering from a condition known as phossy jaw caused by prolonged exposure to phosphorus (which was first discovered around that time). It causes the jawbone to deteriorate. Perhaps he had his own alchemy studies going on behind the smithing front. It would explain the hell fires mentioned by other characters as such bright flames would not have been seen before by them.