I've only turned one kit, a deluxe sketch pencil, so all of my experience really is with custom pens.
So from my point of view, from the selling aspect of it, yes they're worth the effort. Mine go from $125 - $200 each and the oversize 16mm thick pens seem to be really popular.
Is it worth the time involved? To me yes it is. I may only spend 3-4 hours on a pen start to finish. Maybe less now - I dunno. But I enjoy the whole process so I don't really keep track. I know a section takes about 30-40 minutes start to finish, give or take a few minutes.
Is it worth it from an economics point of view? With only about $25 or so in parts, from nib to converter, blanks to clip, yeah, definitely.
Now bear in mind, I'm not trying to make a living at this. I'm a high school art teacher, so my bread is bought with that, but this is excellent extra money - going to be paying for the little one's daycare the next two years with this money.
Also bear in mind that I'm not making that much on each pen since I'm making twins of each pen to give to students - so my investment per order is double what I just mentioned. Now if a customer orders celluloid or wood or micarta, I'm going to make the student pen out of acrylics. No need to go all out and spend all that extra time or money for give away pens.
I've never been to a craft fair so have no clue about that, but the two pen shows I've been to these are the types of pens that will sell. Kit style pens don't move at all from what I've seen. Be they $40 or $400.
Do I sell very many pens? I sell a few - enough for me to keep busy. My queue is down pretty low right now, and as soon as I get one or two pens left to go before I'm out of orders, I get 3 or 4 more, so I definitely keep busy. I've never sold at a show either, I just have my website and word of mouth (and FPN).
I wouldn't call FP users 'snobs' though. They're a very friendly bunch of people for the most part - they are usually very knowledgeable about their pens and what they want. But you're going to find snobs in any group - hopefully you won't let them color your perception of the group as a whole.