Dear Dear Meap, If you have a character with the skill to identify, you give the item in question to that character then right click on the item in your inventory screen and it will give you the option to "identify" or "drop" or "cancel". The button you mentioned, "dragonbreath", will give you special options as your characters learn special traits like "Cloak of Night" or "Backstab" or "Sneak", etc. I hope this helps you, paying for identification is expensive, huh? God speed!
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