When comparing a new item to an item that has an upgrade from the blacksmith, the comparison doesn’t seem to factor in the item value upgrade when comparing.
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FWIW this doesn’t only apply against upgraded items. A lot of the gear comparisons were … let’s say a bit wonky.
Example: I had a weapon equipped with a 230-ish power score, 205 dps that, when compared to another weapon with 120-ish power level and 126 dps it said the lower one gave (+24). Upon equipping the lower stat weapon it then said the one now in inventory was (+32).
Numbers are pulled from memory, so not exact, but close. There were several items I came across that had similar discrepancies.