Raze the Evil: <img src="/ubbthreads/images/graemlins/devil.gif" alt="" />
Kiya the Rainbow Press reporter <img src="/ubbthreads/images/graemlins/biggrin.gif" alt="" />
hope you saved before trying to get into the back room. His opinion of you will drop, and prices go up, if he catches you.
You should be able to steal some things using telekinesis (I maxed this skill with bought spell books). I don't know if this will reach the spell book, though. Wizard's Sight lets you see through the roof of a house so you can use telekinesis from outside (I have this at level 2, also bought).
The magic orb does not do anything, it is just there for looks.
I killed Kistandalius to check out the orb (after saving, of course). My god, did he drop a lot of stuff, including a large charm - combined weight of swords, axes and armour was almost 4000. I killed him again, but he didn't drop nearly as much. He sells charms and spell books, though, so he is more valuable alive then dead.
If you have a mage character, you may be able to use the special move to swap places with him when you are outside. The second time I tried to kill him he ran away and went behind the shop. I tried to enter the back room, but he still teleported me out, so I had to go finish the job. From other's comments, most merchants do nothing if a mage swaps them out of their shop and robs them blind.