Crafting is the process used to create items through recipes and required resources. There are various skills which govern crafting ability: Alchemy, Blacksmithing, Brewing, Carpentry, Cooking, Fletching, Masonry, Pottery, and Tailoring.
This merits a bit further description as it ties in to smithing and all other items that are crafted. Quality of the materials you use to craft items has a direct effect on the end product. A quality of .5 will literally yield half the results. A long sword with Copper is (dmg:dly) 3.5:35, bronze works out to 5.25:35 and iron then becomes 7:35.
One thing worth noting is that with some perks you can add quality to items. There has been no specific mention but I would assume that quality over 100% can be achieved. With the available perks, it would seem that a 110% quality could be achieved for a longsword that is 7.7:35. If the weapon is in the 2% chance of exceptional items that add a 25% it could become 135% at 9.35:35.
Note that when talking about 'adding quality' its always a direct addition. So it's actually:
- Mining Ore: 105%
- Smithing Ore: 110%
- Exceptional Item: 135%
Crafting recipes are aquired progressively as you level up your respective crafting skills.