Blacksmith

You are in the castle... there is still much to be done here mlord. You need items, but shy of coin? Visit the Blacksmith and acquire items at no cost whatsoever. Just select the item you want to create, a rarity, and if you so desire, use gemstones to enhance and ensure a certain statistical value.

Sidenote: As of Version 0.6.13 only items of the rarities, common, uncommon, rare and legendary can be created.

Salvaging
You got useless stuff laying around: A robe with strength, constitution and desterity don't despair! It maybe of some use yet! Simply visit the blacksmith and he'll take apart that stuff and use what he may find. Notice that each (!) piece gives only the corresponding rarity in retun.

and so on.. you'll get the system.

Crafting
Now that you have hopefully acquired some materials by salavging useless stuff, you may create any armour or weapon required. There is always a risk involved in creating items, and you rarely recieve a perfect item, the trick is to find the ony with the most use for your character.