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I noticed the description no longer says it's smithing benefit doesn't work. I went to smithing and tested smithing number with and without equipping an axe I had made using the enchantment since I had disenchanted the picaxe. There was no difference. Is it still bugged or since my smithing is 100 there is nothing it can buff anymore?

I don't know about the Notched Pickaxe in particular but you can get your Smithing up to 320 with Enchanting and Alchemy, 420 if you include the Smithing Perks. so a 100 point cap shouldn't really be limiting you.

but as far as I know the increase in any particular skill won't appear on the Skills screen. the only time I can remember a skill actually changing is when I gave a coin to a Beggar and my Speech skill increased for a while. you should go to a grindstone or workbench to see if there's a difference.

I tried it, nothing. But like I said my smithing is 100 so maybe the thing can't help me anymore.

Bethesda has limited the effects of smithing and alchemy buffs in the 1.3 (or 1.4) patch because they could reach game breaking levels.