Hmm, yeah, you could be right there. I'd still like to see something like what Shizzle suggested though, expanding tournament like events could really encourage some nice RPs.
Yes, I do like the basic idea, too. Common fodder for fantasy novels is the "market day" or local fair, etc. But I'm not sure how "noble" those would be. But the idea of a medieval fair or local festival itself is a really cool idea. The way it was proposed with NPC-based trading just seemed to undermine traders a bit. If you go with Tom's idea of using it as a way to facilitate PC traders communicating with each other, then that sounds like it may help them instead.
