The chest in the battle tower is in the master's chamber, on the left wall of the bedroom as you enter from the throne room elevator and go through the dining room. There are a couple pieces of dragon armour in the chest you'll probably want to retrieve, as well.
Your enchanter and alchemist can use ingredients (plants, minerals, gems) in the battle tower chest, but charms must be in your inventory to use.
Talk to your necromancer and work on your creature; any creature parts remaining in your inventory after that are duplicates, and can be sold (same for potion or enchantment formula, with your alchemist and enchanter). I kept a written list of the best creature parts I found (any lesser pieces could be sold the next time I was at a merchant) as well as the enchantment/potion formula I had (so could quickly check if I needed something that showed up in loot or at a merchant).
