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Apparently they can also be sold for profit, but you won't make much money with that. They require silk, and the only way to get silk is to buy a maximum of 8 pieces per week from the merchant. So even if the profit margin for curtains may be high, you'll produce them in such low numbers that the total revenue is negligible compared to your other options.
Apart from the Woodcutter's quest and selling them, they have no other use.
Edit: I've tried to determine for how much curtains would actually sell, but I can't seem to find an NPC that would buy them. The merchant won't.
Look at it this way: This quest is purely optional, it's a shortcut to get an item that would otherwise require either reaching dungeon level 15, or paying 10 gold to a vendor. It rewards people who like to do tasks for seemingly unimportant NPCs by giving them a cheap and easy way to get a Golden Apple (provided they have a Furnace III to create the other required items). As such, it doesn't need to be very obvious - it rewards people who look _beyond_ the obvious.The people who only follow the _obvious_ clues, will still get their apple - probably from the dungeon -, but they will have to work much harder for it.
If it's as you describe, I would have gotten it by now if I hadn't played only old saves since the DLC, so this time I should get it.