No. It’s only a 20% chance for a promotion to the next tier, and the next tier usually is not selling for 20x the price of the previous tier. There are very very few exceptions to this.
Should I be breaking them down using advanced salvage kits to get rare materials from them?
General rules of thumbs I go by:
-Vendor L20- stuff unless its a green that fetches a price (probably 2-3s)
-Salvage most L20-L69 stuff (except stuff that salvages to metal ore). TP yellow stuff and greens that fetch a price, otherwise vendor.
-Vendor L70+ whites, blues, greens. TP yellows and oranges (see below).
For many mid-level items (L20-L56), salvaging to raw materials (ore, leather, wood, cloth) and TP will return more cash. On average, Light and Medium armor salvage into 3 (chestpiece) or 2 (the rest) raw materials, and Heavy being 2/1. Most low-level items and high-level items are not worth salvaging due to the raw material prices for T1 and T5 materials being so low. Also, some offensive stat-ed green items for for a reasonable rate on the TP.
I seem to recall there’s something special I’m supposed to do with yellows, but I don’t recall what.
Yellows and Oranges L70+ have a chance to salvage into Ectos, which go for around 18s these days. You’ll average 0.9 ectos per salvage of a yellow (higher only with black lion kits), and you’ll notice that the prices of most yellows magically hover around 16s. Thus I don’t bother with the salvage game. In addition, you’ll notice that some yellow L70+ weapons go for noticeably above 16s. I believe this is because they have a chance to mystic forge into a precursor, and so there is more demand.
And if I want to start making money to eventually buy another character slot, should I be auction housing basic materials I’m not using to level up my crafting?
Sure. Small change though.
Or am I supposed to do something with the mystic forge and all these mystic coins
Mystic coins are used in some mystic forge recipes for some weapon skins, legendary weapon components and some other forge stuff. If you don’t plan on doing any of that, selling them is an option.
and the skill points I’ve got on my maxxed out character? I know there’s something about transmuting materials that I’m overlooking.
Yes, you can transform lower tier “fine crafting” (eg/ bones, blood, etc) materials into higher tier ones. There are other recipes for “rare” (eg/ corrupted/molten/etc cores/slivers/etc) and “common” (ores/wood/etc) as well, but ignore those for now. The formula is 50 of the lower tier, 1 of the higher tier, 1 dust of the higher tier, and some philosopher stones (cost skill points, number dependent on the lower tier). This returns on average 16 of the higher tier (only 7 for the last tier though). Generally only T1->T2 is profitable. You can check out this auto-updating google spreadsheet for current returns on that. You’re looking at around 30-40s per skill point.
Do this if you don’t need your skillpoints. It’ll probably give you the biggest boost in cash.
Only other uses are legendary chasing and special weapon skin forging (which can also be profitable, but volume is tiny)