No way. Full loot games are GREAT for crafters. When I played UO I was the first smith to hit GrandMaster on the Pacific shard. I think for the first year of Ultima my GM skills were Smithing, Mining and Magery (so I could use gates to haul ungodly amounts of ore back to a forge for smelting).

The fact that players were constantly ganked and that armor wore out over time meant that there was always a need for my services.

People were also less attached to their stuff. You get used to dying and sometimes loosing all your items. If the game is not a item-grindfest like WoW, what you have is easily replaceable. Just like EvE, you loose your ship and tons of stuff but you move on because it happens to everyone. EQ invented the "loot = might" in MMOs and WoW enforced it so much that MMO players cannot fathom a more realistic sandbox world.

Now, as for crafters getting ganked. Well, if you are going to put in open world ganking and you want crafters, then you need to also put in tools for them to hide. In UO I could hide and mine. It didn't mean I was totally safe, but I stood a chance. Actually, I would say only 1 out of 20 or so times someone would actually search hard enough to find me when I was hide/mining. Since my Magery skill was high enough, I usually could get out of harms way fast enough anyway.