I've read a number of posts on other boards alledging that this item allows non-smith chars to repair armour. After a few simple test I've reached the conclusion that this isn't accurate.

I believe that it is, in fact, the Jack of All Trades property that is allowing people to repair armour and not any special property of the hammer.

If you repair with this hammer you are not trusting to a special item, you are trusting to your 20 smithing points from Jack of All Trades. There is still a chance to break.

disclaimer: This is personal theory only, unproven, but worth taking into consideration before you try to mend your best doom artifact with it