The imp hero wants me to kill the Giant Spider. Well I did, and he just keeps asking me to kill it. Also, where is the 'mummy' these little idiot imps keep telling me to kill?

I'm having a REALLY hard time in act II. I die in almost every fight with 2 or 3 enemies and I'm using more potions than ever. Is there a way to get charms out of an item and put it into a new item? All my good charms are in crappy items I don't wear anymore.