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You can sell the gems, there are few that you need in the game, unless you are told. Some, however are needed to start a quest and to up grade an item. (I won't tell you, you may want tofind out for yourself )
As for the spells, the green represents a protection scroll. It can only be used once and cannot be learnt. As for the other spells, red indicates offensive, blue defensive and white neutral, ie some other non-combat related effect such as revealing an area of the map.
Hope this helps.
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