Its odd item, since you can only drink it ... i didnt find any way to coat your weapons with it, unless its thrown and you then dip in that puddle.
Yes, it’s a fake healing potion and trap for the unwary as the default action is to drink rather than coat weapons. I confess I made that mistake once, and now just don’t pick it up! But if it does the same damage as a regular poison it would certainly make sense for it to work as a poison in the booze barrel.
"You may call it 'nonsense' if you like, but I've heard nonsense, compared with which that would be as sensible as a dictionary!"
