[MunkDev]

SellAllInBag = CreateFrame('Frame')
SellAllInBag.itemsToSell = {}
SellAllInBag.pendingBags = {}
 
function SellAllInBag:SetCurrentBag(bagID)
    wipe(self.itemsToSell)
    self.currentBagID = bagID
    self.itemsSold = 0
 
    local toggleEvent = (bagID ~= nil) and self.RegisterEvent or self.UnregisterEvent
 
    toggleEvent(self, 'BAG_UPDATE')
    toggleEvent(self, 'BAG_UPDATE_DELAYED')
end
 
function SellAllInBag:AttemptSellItems(index)
    for i=index or 1, #self.itemsToSell do
        UseContainerItem(self.currentBagID, self.itemsToSell[i])
    end
end
 
function SellAllInBag:ProcessNextInQueue()
    local bagInQueue = tremove(self.pendingBags, 1)
    if bagInQueue then
        self(bagInQueue)
    end
end
 
function SellAllInBag:OnEvent(event)
    if ( event == 'BAG_UPDATE' ) then
        self.itemsSold = self.itemsSold + 1
    elseif ( event == 'BAG_UPDATE_DELAYED' ) then
        if ( self.itemsSold == #self.itemsToSell ) then
            self:SetCurrentBag(nil)
            self:ProcessNextInQueue()
        else
            self:AttemptSellItems(self.itemsSold)
        end
    elseif ( event == 'MERCHANT_SHOW' ) then
        self.merchantAvailable = true
    elseif ( event == 'MERCHANT_CLOSED' ) then
        self.merchantAvailable = false
        self:SetCurrentBag(nil)
        wipe(self.pendingBags)
    end
end
 
SellAllInBag:RegisterEvent('MERCHANT_SHOW')
SellAllInBag:RegisterEvent('MERCHANT_CLOSED')
SellAllInBag:SetScript('OnEvent', SellAllInBag.OnEvent)
 
setmetatable(SellAllInBag, {
    __index = getmetatable(SellAllInBag).__index;
    __call = function(self, bagID)
    --------------------------------------------------
        if self.merchantAvailable then
            if not self.currentBagID then
                self:SetCurrentBag(bagID)
 
                local itemsToSell = self.itemsToSell
                for slot=1, GetContainerNumSlots(bagID) do
                    local link = select(7, GetContainerItemInfo(bagID, slot))
                    local sellPrice = (link and select(11, GetItemInfo(link))) or 0
 
                    if sellPrice > 0 then
                        itemsToSell[#itemsToSell + 1] = slot
                    end
                end
 
                if #itemsToSell > 0 then
                    self:AttemptSellItems()
                else
                    self:SetCurrentBag(nil)
                end
            else
                tinsert(self.pendingBags, bagID)
            end
        end
    --------------------------------------------------
    end;
})

Here's a robust solution for you. Using C_Timer.After is bad for multiple reasons, one of which is asynchronous execution.
Unlike the others, this takes into account if you're actually interacting with an NPC and it is safe to use even if you have massive lag.
It's a bit over-engineered, but I think this is your best bet. You can also run this for multiple bags and it'll queue them up and finish them off in order.

The way it works is it attempts to sell as many items as possible at once, counting each item that goes through, but when the server throttles your request, it'll queue a new attempt to sell as many items as possible from the items you have remaining in your bag. It will look like chunks of items are disappearing out of your bags.

Usage:

SellAllInBag(0)