Hammers are not needed to refine a item.
Oris are only required for level 3-4 weapons. Emetreacon(however its spelled) is required for level and pharacon for level 1.
Armour is always the same level regardless of cost.- Always same refining rate as level 4 weapons without the 10% bonus.
I'm assuming that you don't have the right upgrading material.-refer to list of materials needed to upgrade weapons.
Is the weapon in inventory? Pretty sure it dosn't work if equipped.
Either that or your glitched.
For blacksmith ranks, you only get points for creating weapons; not refining them. Naturally, level 4 weapon creation gives more points than a level 1 and so forth.
At level 70, the 10% plays a large role in breaking or success. But it depends on what your refining, level on weapons for example can be overupped to +7 without breaking. Level 4 weapons on the other hand have a chance of breaking from +4-+5-10.