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Beginner
White Knight
Dragon Knight
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Dark Knight
Required quests
Unlocks quest
Main dialogue
That's correct. Z is used to pick up items on the ground dropped by the monsters. The other key you can use to pick up items would be 0 on the number pad. As for the seldom-used X, you can use that to sit on a chair. Once you head over to Victoria Island, you'll find some chairs you can sit on. You should try it, since you can recover much faster by sitting as opposed to just standing still!