"The selected item level too low to maximize materia potential"

[LineageRazor]

The error message is REALLY misleading. It should read something like "The selected item has already reached its maximum potential for that stat." I spent a LONG time believing that the reason I couldn't meld a STR or MND materia was that for some reason you needed really high level equipment, when the answer was that I needed to meld these materia onto gear that didn't ALREADY have STR or MND on them (and therefore hadn't already reached cap for those stats).

[StouterTaru]

If there were no caps, VIT IV materia would be selling for 500k+ each, and the top gear in the game would be 2 star crafted gear with attribute materia.