If you go circle, you still drop non circle items at the base rate that trade has, right? And those items won’t be tagged as CoF. So you could swap over to trade just to trade those base items and swap back. Then the gold you just use on dungeon or tabs. Definitely doesn’t break the game and actually probably helps economy by having more items listed. Need to also have trade faction leveled too
When you swap to trade, you are missing a step of farming the favor to trade it while you are representing MG.
Oh and even if you did that, the only items that are eligible to be traded are those found while not representing CoF. This means that this plan doesn't work at all.