I travel to the Kansai region of Japan reasonably regularly, and I've been to Sakai (it's Sakai near Osaka, not Seki, which is somewhere else). Some very brief notes as a starter...
In central Osaka, there's the kitchenware street, Doguyasju. On it, you'll find Yamashita (opposite the supermarket, weekdays only 9-5pm), which has an excellent selection of Sakai Takayuki knives at good prices, and an extremely helpful shop assistant who speaks excellent english. Sakai Ichimonji a little further down has a wide range of all kinds of knife-related things, their Japanese-style knives are good, the western-style less so.
Sakai itself is an easy trip from Namba station. In Sakai station, there is a very helpful tourist information office. They can give you a map, find and show you addresses, and call ahead. Well worth exploiting. On the web there are a few reports from people who've visited Sakai, which I found helpful when I went. I visited the Knife Museum (very interesting), Suisin, Tadatsuna, Konosuke. Sakai Yusuke is also not far; all are walkable from the station. I didn't spend long enough there to attempt to visit a blacksmiths though, this being japan, I'm sure if you asked the right people, this could be arranged - Japanese people are very welcoming and are generally very pleased to see foreigners taking an interest in Japanese things.
Do try to spend some time in Tokyo - great knife shops (Kappabashi-dori, Aritsugu, Sugimoto, Masamoto) and Tsukiji itself is a must-see. Also, in terms of eating, Tokyo has an easily accessible and varied range of food on offer, it's a total culinary highlight. Plus it's a cool and massively interesting city to wander around in.
Osaka itself I like, it's a friendly place and you won't go hungry ;-). But the food there has a tendency to be fried (Kushikatsu, Okonomiyaki, etc.), which I'm not so keen on. However, Osaka is a wonderful location to explore the rest of the Kansai region and it's totally worth going to e.g. Nara, Kyoto, Kobe, Koya-san, one of the onsen towns, etc. Kyoto particularly has amazing food, and the various temples/gardens will be spectacular at that time of year. There is so much to see off the beaten track in the Kansai region.
One thing I've also fallen in love with is japanese tea. Uji, somewhere between Nara and Kyoto, is one of Japan's best tea growing areas and is well worth an overnight trip.
Also, Japanese ceramics are gorgeous, find space in your luggage if this is something that tickles your interest!
Final tip. If you can, learn some basic japanese language before you go (it's not hard, honest!), and also try and pick up an appreciation of japanese cuisine (e.g. what/how/when various dishes are eaten, how a meal is structured, what to expect in various styles of restaurant). This will massively help you get the most out of a trip, since the best food is found slightly off the beaten track and the ability to walk into random joints and be able to converse/order a meal without any language issues is well worth obtaining.
I'm loth to give specifics on a public forum, but do get in touch if you want some tips.