Just interested to know has anyone ever made their arduino project into a product and sold it?
it is viable cost wise? Is it allowable to put your own branding on it?
It's Open Source, yes you can. Read the rules on the Arduino site about what must stay Open and why.
If you want to compete with China, you make special items not run of the mill.
A couple of forum members who make and sell boards:
http://www.crossroadsfencing.com/BobuinoRev17/
http://www.inmojo.com/store/liudr-arduino-and-physics-gadgets/