Q: Merchants have the ability to open factories and keep them running even when they're not online, assuming they have enough money to purchase the resources.  What happens if a merchant is away from the game for a while and the factory eventually ends up losing money -- will it go under or be taken over by another player?

PT: A merchant type will have to set what items the workshop ("Aurochrome" in DE speak) is to make and how much, at a maximum, the workshop should pay for the base resources. Also, optionally, the workshop can be told to make only a certain number of items and also the minimum price to sell those goods on to the market for.

Thus, you can make yourself a new sword, your guild a new sword, or keep making and trying to sell swords to the market while you sleep. Of course, if you try the later and no one buys your swords (maybe your minimum price was too high!) your Aurochrome may keep on buying resources and stockpiling swords. Not a problem if you're rich, too bad if you're short on cash, you'll have dozens of swords and not a coin in sight. Perhaps a bulk sale on the market at a cut price might recoup some losses? Alternately, perhaps if you put some time to hand craft some add-ons to make enhanced items you can sell your supped-up swords back to the market and make back those losses.

Since everyone can run a factory of their own there is no need to worry about losing your factory. The worst you can lose is the shirt off your back in a bad trade move!