How are the item values calculated? The reason I ask is that I assumed that the higher the value the better the weapon. However that doesn't seem to be the case.

Ex:
an Amber Katana does 7-15 damage values at 4500 (base 4-12, w/ Amber bonus of 3 dam)
a Gold Broadsword does11-20 damage values at 2000 (base 3-12, w/ Gold bonus of 8 dam)

I am missing something here, but not sure what

The weapon/armor base price is multiplied with the material modifier like
60 (amber) * 75 (katana) = 4500 or 40 (gold) * 50 (broadsword) for example, extra elemental damage or stat boosts is added to the price.
Precious material like amber or ebony is more expensive than simple metal like steel or gold but less effective.

This is one reason I actually prefer to look up item stats in the cluebook even though it is "cheating". Getting all this stuff identified in-game so I actually know what the best equipment is becomes quite tedious.