You hold one of the variables constant and find the derivative of the other when trying to find the partial derivative, so wouldn't something like this be correct?:
$\frac{\partial}{\partial x}(|xy|) = \frac{\partial}{\partial x}(|x||y|) = |y| \frac{d}{dx}|x|=\frac{|y|x}{|x|}$
Or would this be correct:
$\frac{\partial}{\partial x}(|xy|) = \frac{\partial}{\partial x}(|x||y|) = |y| \frac{\partial}{\partial x}|x|=\frac{|y|x}{|x|}$
Or are either of those fine?
Any help is appreciated.
The basic problem: the Leibniz notation is confusing and deceptive. Wonderful quote from How misleading is it to regard $dy/dx$ as a fraction?:
In your case, we can write (for $x\ne 0$!) $$\frac{d}{dx}|x| = \frac{\partial}{\partial x}|x|$$
without confusion because there are no more variables involved.