I'm sure that almost everyone has more red/green/blue shards than they know what to do with, and I'm personally tired of finding only Blaze Peppers for 4 star items, of which I now have 12, so I had two possible ideas for how to use these items:
1) Be able to craft semi-permanent dungeon items. By this, I mean do something like 20 Red Shards make the small health restore item, and 50 makes the large one, but unlike the ones dropped in dungeons these will not disappear upon dungeon completion, only upon use. For simplicity's sake, we can say that once crafted they will instantly be moved into the item bar, and if slots 1~5 are full no new ones can be made. We could also just add a new slot in the inventory for "Usables" which, like weapons and armor, cannot be switched out in the middle of a dungeon. Also, to prevent confusion, crafted items shouldn't stack with pickups, so players know exactly when they're using temporary poison vials and permanent ones.
If the inventory system is implimented, then there could even be multiple recipes for them, such as 20x green shards for a poison vial, 50x for a large poison vial, or 1 blighted bone for 5 large poison vials.
2) Have a resource "smelter." Players can dump excess items into the smelter and get a point value for them, say 1 point per star of the item being dumped. Players can then trade these points in for various things, such as equipment, energy, or crafting materials. To prevent some kind of abuse, the items that can be bough would rotate, so today the smelter can be "selling" Blighted Bones for 50 points, but tomorrow it could be selling Blaze Peppers. I would also suggest certain limits to the smelter, as follows:
* For equipment, there will never be anything above 3 stars offered, and even then, only 1 or 2 pieces of that level a cycle (the time it takes for the offers to rotate)
* For crafting resources, I don't know if 4 star items should be offered, or if they should only be offered rarely, but I definitely think 3 star items should be. 5 star items should never be offered.
Oh yeah, the smelter should grant extra points if the item that's being dumped is something above what the smelter offers. For example, if the smelter offers only up to 4 star crafting items, then if I dumped a Plague Essence it would give me 2x the normal amount of points (so 10 instead of 5) or something along those lines.
The "useless" items won't be useless once they finish adding recipes.
I'd leave it at that, but I also want to point out that being able to craft consumables and take them through dungeons, and making it so they don't stack with normal pick-ups would completely defeat the purpose of the system currently in place.
I don't really see how the smelter is different from the buying and selling already in place. It just uses a separate, non-tradable currency.