Is it fine for me to just dump all materials into Shop Expansion?
Donate all of them except:
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Mud Rock
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Block of Quartz
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Fossilized Insect
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Iolite Ore
Sell those to vendors instead.
Iolite Ore is really rare, you can trade for it with Black Feathers and it's worth 10k gald. It's kind of crappy considering how many feathers it costs and you can easily get over 10k gald in a single fight by encounter linking + gald food.
Save at least 1 of the following for quests:
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Heart Herb
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Navi Metal
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Peachberry Blossom
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Peach Elephant Tusk
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Pink Emerald