I think I might have stumbled on the answer to the problems with item recognition ...

Wisdom rune duplicate: There are TWO wisdom runes in the game. If you have the "old" wisdom rune you got on an earlier level in your main inventory, then the instructor will not recognize that you have the correct gudge. I never went to the rune room (upper middle of academy level 2) to get the wisdom rune because I thought I had already stumbled across it and didn't need to go there.

This also is true even if you have BOTH the old and the correct rune in inventory. Finally, I passed the other one (cannot for the life of me recall where I collected it earlier ... perhaps in the level III temple catecombs or the originallevel IV tests?) to the DK, and the problem went away.

Disappearing book: I too "lost" the library book, until I finally realized it was under the second to the last tab in my inventory, not the last tab where I expected it. Senility strikes yet again <img src="/ubbthreads/images/graemlins/sleepey.gif" alt="" />!

Hope this helps.