Ok lets do the math
Code:
# Item MSV
01 Neatherweave Cloth 8
01 Heavy Netherweave Bandage 30
# Item MSV
20 Neatherweave Cloth 160
10 Heavy Netherweave Bandage 300
Auction house cut, in factioned AH
Cut = 0.05 * Winning Bid
This gives us 15s cut from the NWC on the AH, if we sell at 3G
Making the total income 285s Vs. 300
Another thing to factor in here is the deposit, which you loose if the item does not sell.
The deposits are as follows in a factioned AH.
Deposit (12hr) = 75 % MSV
Deposit (24hr) = 150% of MSV
Deposit (48hr) = 300% of MSV
So if we go for 12hr auctions and doesnt sell, the loss is 120s.
So what we can conclude from this is that given the chances that you are underbid, or noone needs the item, and you don't mind the extran time spent making the Bandage, Bandage wins by a large margin in any statistic.
3G is simply too small in comparison to the MSV to make it profitable, actually an easy task to calculate.