- Dagger -> Severed hand - One of many severed limbs found among Erstam's home. You can trade for your dagger back if you want.
- Map of Britannia -> Ice Wine - Made by the Rangers at Moonshade's winery, but your map is not there. (This is a design oversight - your map is nowhere to be found in the winery or anywhere else.)
Items Still at Large
- Magebane -> Blue egg - It's in a penguin nest up North, as viewed through Erstam's telescope. We haven't been up that way yet though.
- Magic Helm -> Fur cap - Frigidazzi in Moonshade is said to have had such a cap. We haven't had a chance to talk to her just yet though.
- Blackrock Serpent -> Fine stockings - They belong to Columna and both she and Torrisio want them back. They seem to have no knowledge of the Blackrock Serpent, nor is it anywhere to be found in their manor.
- The Black Sword -> Ruddy rock - Pothos mentions that it's a piece of "stoneheart", an illegal type of rock used to make the potent reagent "bloodspawn." He gives no clue to its origins, however.
- Rudyom's Wand - Lab apparatus - Ask around in Fawn and Moonshade. (Erstam claims that it's his, but this is not correct. It's actually in the possession of another character we'll meet later).
- Spellbook -> Pumice piece - Krayg mentions the dungeon of Furnace, said to be an extremely hot place where rocks like this appear.
- Glass sword -> Pinecone - Most likely came from the forests to the north.
- Burst Arrows - > Hairbrush -> Made by the goblins that plague Monitor.
Ah yes, and one important thing I neglected to show on camera:
Once you've got the Serpent Jawbone, talk to Erstam and he'll give you two more teeth for it. Each tooth opens up one of the gates on the Dark Path when placed in the jawbone, and each gate takes you to a connecting Serpent Gate somewhere on Serpent Isle. Some areas can't be reached in any other way (short of cheating) so when you find a tooth, be sure to put it on the Jawbone right away so you don't lose it!
Bonus Video: Erstam's Retreat
A well-known hidden area in the game, akin to the Trinsic cheat room in Ultima VII in that it contains not only a treasure trove of equipment, spells and reagents, but many plot-essential items as well. As such, visiting here is considered "cheating" and should only be done for entertainment value.