Well, I've been referred to the jeweller by the tradesman (house closest to the blacksmith), who mentioned to speak to the guy in the market (Gi-something?). I was also told that he and his 'entourage' have rented a house by the south wall. Thing is I've never managed to meet him... I've been to all houses at nighttime and daytime, and haven't seen him... is he supposed to be there? Or is he only expected to appear in the final release?
Final release: thats why there is a reference to someone else who can also help you. His house is in the little 'cul-de-sac' north of the Provisioner's Shop if you want to check it out, there's a book about the various new jewels and gemstones in the game.
I figured that would be his home... and tried it at night and day, to no avail. Well, that confirms my suspicions. The books, BTW add a lot of background depth to the game, something completely absent from ToEE... Bravo for that too!!