Yeah, it would crash a segment of the market. But I believe that market shouldnt have existed in the first place.
Subjective. I see nothing wrong with the materia market.

Since you can go up to five slots in the current system just based on chance you can make some pretty funky and likely unintened (in SE mind) stats on gears.
And you just described exactly what is wrong with your proposal. This would require the total rebalancing of all materia to account for the fact that you're guaranteed to be able to 5x-meld anything. Materia are tuned to be on the strong side because it is difficult to get highly melded gear. With your system, materia would have to be nerfed into oblivion since anyone can have it with no risk or effort involved.