As a character here, you have a body. Your body is divided into distinct parts which may be used for various tasks, including combat and inventory handling. For example, 1) Some parts can be used to hold things. 2) You can wear clothing or armor on some parts. 3) You can attack with certain limbs. What bodyparts you have depends on your race. You will generally have a set of limbs, a head, and a body.
For combat purposes, each limb is able to absorb a certain amount of damage. When a part is damaged badly, it may become disabled. If it is a limb used for attacking, you will no longer be able to use it for that. If it is used for moving (i.e. legs) you may not be able to move well or at all. Any item held in the limb falls to the ground. In most cases, disabled limbs will not heal over time. Magic must be used to heal them. Limbs may also be completely destroyed, in which case, much more powerful magic must be used to bring them back.
Damage to the parts of your body is reflected by damage to your overall health, depending on how important the damaged part is. Your head and body are the most important parts. If your head is destroyed, you die, no matter how much health the rest of your limbs still have. Also, if you soak up enough overall damage, you may die, even if your parts are in perfect health.
Your hands (or equivalent parts) are used to handle your inventory. You must always have a free hand to pick up an item. Ordinarily, you can only hold as many items as you have appropriate parts. To overcome this problem, you can specify a container (preferably one that can be worn, like a backpack) and use the "set moneybag" and "set pack" commands. These both direct objects that you get and drop to and from a particular container. "set moneybag to item" will direct all money into and out of the item. "set pack to item" will direct all other objects into and out of the item. Keep in mind that you still must have a free hand to do this.
Bodyparts Helpfile Updated 11/93 by Raven