Coming to this a bit late, but on the fees question it helps to know exactly what Etsy charges a UK seller, so you can do the sums for your own product before you start.
Going by Etsy's fee pages as they are now, on each sale:
- transaction fee: 6.5% of the item price plus postage
- payment processing: 4% + 20p
- UK "Regulatory Operating fee": 0.48%
- listing fee: 20 US cents per listing, converted to pounds
- and if you haven't given Etsy a VAT number, VAT at 20% is added on top of those fees
On a £20 sale with postage built into the price, that's £1.30 + £1.00 + about 10p = about £2.40, or about £2.88 once VAT is added, plus the listing fee.
Then there's Offsite Ads. If the buyer came through one of Etsy's own ads on Google, Instagram and so on, Etsy takes another 15% of the order (12% once a shop has made $10,000 of sales in the past year). On £20 that's another £3, or £3.60 with VAT. While your shop is under $10,000 a year you can opt out of Offsite Ads; once you're over it, you can't.
If your fees ever look higher than you expected, the payment account in Shop Manager lists every fee per order, so you can see exactly where it went.
So before you settle on a product, work it backwards for each item: take the price, then subtract the Etsy fees, materials, packaging and your time at an hourly rate you'd actually accept. What's left is your real profit.
The hours are the bit people leave out. littlecornishsea's numbers above show why: £1,000 a month profit at 40-50 hours a week is roughly £5 an hour. So put your own time into the sum from day one.
It can still work, usually for something with a good margin that isn't easy to copy or churn out. The sum is how you find out. If the answer is thin at the price similar items already sell for, much better to learn that on paper than after 50 sales.
Good luck with whatever you decide.