In the Civic Festhall there is a wizard who will allow you to clone the appearance from one armour and the item properties from another.
This results in the destruction of the original two sets of armour and the creation of a new set that combines appearance and properties.
You need to be careful not to get them the wrong way around, otherwise you will end up with the wrong appearance and the wrong properties.
Basically beacuse you can spend a lot of time customizing a set of armour for your character. You then go out and find a better set of armour, and inwardly groan because you have to spend a lot of time customizing your armour all over again.
This feature allows you to, at the cost of losing both sets, to get a new set with the look you spent ages getting and the properties of the new set you found.
The two armours must be of exactly the same base type. eg: Chainmail and Chainmail. It will not work between different types. This is to stop potential exploits.