A letter of recommendation is a piece of paper whereby an existing noble acknowledges that a commoner is fit for nobility. It is a requirement for Adventurers to collect three or more recommendations before they can become knights. When an adventurer sells an item to a noble, the noble will be offered the opportunity to provide a recommendation to the adventurer. The cost of providing the recommendation is 5 gold to draw up the papers. The noble must immediately make the decision; he cannot go back and give the recommendation at a later time. If the gold is not available, or the noble chooses not to give the recommendation then and there, the opportunity is lost.
Worth of Recommendations
It is very strongly suggested that recommendations only be given for the most valuable services and loyalty. For example, for selling you a unique item. In fact, right now that is the only game mechanic that offers the option of handing out a recommendation.
Note that, even if you sell them two items, you can only get one recommendation per noble.
Advice to Nobles
There is no way an adventurer can ensure that you give him a recommendation. The option is presented after you have received the item. Even if you promised him, feel free to cheat him out of it. After all, he's just a commoner. Make him beg. Tell him you forgot and you'll be sure to do it for the second item. Hey, once he's got those 3 letters, he'll be a peer of yours and you can't order him around anymore! You don't want that to happen too soon, do you?
Then again, you might not want to alienate such potential knights. They may be valuable, especially when your nation is short on fighting nobles. Furthermore, you should consider the possible effects of widespread discontent among adventurers; what if they go on strike and leave the nobility to handle monsters and the undead?
Depending on how the adventurer is played, recommendations can mean different things. This is a roleplaying differentiation, the game-mechanics are the same.
Adventurers who really are peasants can be "knighted" through recommendations. While nobles are big on blood and family trees, fact is that every noble house has to start somewhere. Some noble families bury their beginnings in ancient history, but others are proud of their accomplishments, especially if they were knighted for especially heroic deeds.
Adventurers who are fallen, unrecognized nobles, recommendations are confirmations of their status and proof that they've been saying the truth all along.