Airshark says:
... bought the sword with my starting money ...
There are a couple of levels at play here. 'Buying' things with starting money is a mechanical issue to provide some semblance of 'balance', it should not limit the fiction of the story.
So you are welcome to make up an appropriate story about your sword's history (appropriate for a
Fresh Faced Adventurer, that is).
In this case though: so far as you know, your sword has never glowed before, this is a totally new thing, and is happening to at least two other members of your party's weapons as well, but not to all of them.
It has been busy, and the hints were small, but all the information you need to understand this glowing mystery is available. (This mainly means that I hope the reveal will be 'that makes sense' and not 'huh? what?':).
Airshark says:
... make up a story about an old rusty sword I found or bought and restored.
Or is the story ''I bought it ''? ...
Don't expect it to pay out, but something with history is more interesting.
Dirk's machete is something he found in a archaeological dig, for instance, and there may be a connection to current events.
Airshark says:
... is the starting money part of the story ...
That money is just to get you started with some gear. It does not need to feature in the story. Didn't I offer you in-fiction ways of getting more 'starting money' at the cost of in-fiction debts and obligations? I lost track of who that was. So we can work around the money if it does not fit the story.
Airshark says:
... ceiling on the gear you are allowed to have at the start ...
Mainly that. It serves as a quick way to get started, nothing more.
Good questions, though.
Airshark says:
... no magical weapons possible for xx silver ...
Really 'no magical weapons exist', so far as you all know. That is the merely stuff and legend. And who would
sell the stuff of legend?!