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ok, on my adventures, i have run accross some odd items, and have NO clue what to do with them. here are the ones i have..... fairy dust, gargoyle skull, strange holy water (?), and ironwood. what the hell are these things for, they are taking up room in my bag of holding?

When you find a smithy, you can take those types of items and some enchanted weapons and armor and the smith will combine them to make a better weapon.
Spoiler
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theres one in the weapon shop in the city core in the first chapter.

Spoiler and things

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I made a feyduster+1 out of a shortsword+1 and a bottle of fairy dust. Well, I didn't but the dwarf smith in the city core did. It's anybody guess so far where the next smith dude is.

Oh... Another use for all this "crap" is in Port Llast. The chick at the magic shop asks for a spell component of some type before allowing you to shop at her store. She's got some nifty stuff.

I think quartz is another component. I'm not sure tho'.

DeSoya

the smith in the city core will also give you a book on the various items needed to create these items... quite helpful to know what is needed and what can be sold for cash...