What can an item do when used outside of battle?
When used from the item menu outside battle, an item can do one of three things:
An Attack (cure)
An item can do an attack on one of your heroes. This attack will almost always be a cure attack that restores health, but it does not have to be. Attacks that change stats other than Health and Magic (HP and MP) are permanent when used outside of battle (they are temporary when used inside of battle).
Some attack features such as chaining have no effect outside of battle (only the first attack in a chain is used). See Out-of-battle attacks for details.
A Text Box
An item can also cause a text-box to be displayed. You can also indirectly trigger a script with an item by attaching the script to a text box, and then making the item show the text box.
Learn a Spell
An item can teach a hero a spell. The hero must be able to learn the spell for this to work.