No fabricate can't "convert an adamantine arrowhead into a cubic foot of raw adamantine?".
Fabricate only re-arranges what is there; it does not create new material. An adamantine arrowhead is less than 1 cubic inch of adamantine, and that's all you've got (and that's a generous assumption that the head is solid adamantine, not just a inlay over the edges on a steel base).
However, the end product of a fabricate spell can most definitely exceed the value of the items used for the spell component. PF approximates crafting as needing raw material worth 1/3 of the sale price of the finished object. With a pile of steel ingots, some leather and some thread worth a total of 50 gp, you could make a 150 gp suit of chainmail. If you have high enough craft checks, you can make a masterwork suit of chainmail, worth 300 gp...
