How can you get your gadgeteer to merge items into a new gadget? The manual lists this as one of their special class abilities but I haven't found any interface option to attempt this operation.

There is a merge and split button on one of the inventory screens. You basically just click on stuff to see if anything will happen. The manual does a poor job of explaining but the hint book gives you what stuff to meger together to form the gadget. From what I have gathered the stuff your gadgeteer creates is equivelent to the spells of a mage . . . Except that it is unlimited use.