Assuming you've put points into the blacksmithing skill you can head to the nearest forge and start dismantling all your old weapons and armor and using the parts to craft new, better gear for yourself, like a bloody
big flaming sword or a fetching new cloak which just so happens to bolster your magical powers so that you can happily electrocute people for hours on end.
How could you not love a game that had a picture of a floating eyeball and a cool chick with a
flaming sword, and some kind of crazy cat creature with
big fangs?