Wiki says: Vellum (from the Old French Vélin, for "calfskin")[1] is mammal skin prepared for writing.
Edged or blunt attacks are defined in the weapon file, not in the material file. Nothing gets converted. How deep it cuts is also set in the weapon file. Shear values (all 3) affect the edged attacks power, among others.
Adamant is bad for blunt weapons because of its low density. Best material for blunt weapons, by far, would be slade.
And the last two questions: I suppose the answers are Yes and Yes.
And we are derailing the thread... a bit.
EDIT:
Impact elasticity: Used for blunt-force combat; lower is better. This is the raw value.
Shear elasticity: Used for cutting calculations in combat; lower is better. This is the raw value.
This is from the wiki. IT IS WRONG, HIGHER IS BETTER.
MORE INFO:
Weapons involve a little more detail:
[ITEM_WEAPON:ITEM_WEAPON_SWORD_2H]
[NAME:two-handed sword:two-handed swords]
[SIZE:900]
[SKILL:SWORD]
[TWO_HANDED:67500]
[MINIMUM_SIZE:62500]
[MATERIAL_SIZE:5]
[ATTACK:EDGE:100000:8000:slash:slashes:NO_SUB:1250]
[ATTACK:EDGE:50:4000:stab:stabs:NO_SUB:1000]
[ATTACK:BLUNT:100000:8000:slap:slaps:flat:1250]
[ATTACK:BLUNT:100:1000:strike:strikes:pommel:1000]
SIZE determines how heavy the weapon is. This has a substantial effect on weapon effectiveness.
SKILL determines which skill is used in using the weapon; a list of skills can be found on this page.
MINIMUM_SIZE determines the minimum size a creature must be before the weapon can be wielded, while
TWO_HANDED determines how large a creature must be in order to wield the weapon with one hand.
Attacks take a little more explaination.
The first value determines the contact area of the weapon's attack; this should be high for slashing or bludgeoning weapons, and low for piercing and poking ones.
The second value determines how deep the weapon penetrates - for BLUNT attacks this value is ignored as they're not supposed to penetrate anyway, but in the case of EDGE attacks it should generally be lower for slashing attacks and higher for stabbing attacks.
Following these are the adjectives used; they should be self-explanatory. Finally, we have the velocity modifier, which has a multiplying effect on the weapon's size for the purposes of determining how powerful it is in combat.
Other, more miscellaneous items are generally simple and shouldn't require any further explanation.
Once you've made an item, you just add it to the civ entry so a civilization can actually craft it, and it's done.