Without doing one ounce of testing [img]graemlins/givingspeech.gif[/img] my understanding is that the game only looks for any curing spells (and similar special abilities) in the group plus the aforementioned one hit point per character per eight hour rest ... I'm not sure whether a Paladin's 'Lay on Hands' enters the equasion or not ... but otherwise I suspect that items are not accounted for (want to wake up with half of your Potions of Extra Healing missing?

). It certainly doesn't account for the Cloak of the Sewers' regenerating option.
Anyone who's tested this matter ... well, I bow to your advice on this one.