C is the answer.

Whenever you take action, your character has a recovery period. I'm sure you've already noticed that the length of that recovery depends on the action taken (Resurrect takes significantly longer than Heal before the character is ready to act again).

Wearing armor increases the amount of time required to recover from taking an action, and the heavier the armor type, the greater the recovery penalty (plate takes longer than chain takes longer than leather). The "reduce recovery penalty" offsets or removes that that recovery penalty.

There are other modifiers to recovery time, but the armor perk for reducing/removing the recovery penalty relates specifically to the armor's modifier. I usually go for master in the heaviest armor the character can wear and never add another skill point to it beyond that, even for my knight. Master it and move on to another skill. It is relatively minimal investment compared to going from 20 to 21 in a magic skill, and I usually do it early which is when it matters more.

I typically Master whatever skills that the character will be using, then pick a skill dump (usually Light, Dark, or a weapon skill/armsmaster) for any remainder that will increase the character's damage output. I'll usually improve weapon skills to the minimum needed for Master even for the casters since I know I'm going to be using their weapons periodically. As least get Expert Dagger so they can wield two daggers at once, then you can put weapons with stat bonuses in each hand even if you aren't going to be swinging with them.

Eventually your current weapons will be outclasses, so it isn't worthwhile to improve the weapons beyond Master. Possibly beyond Expert, which saves maybe 18 skill points total.

Iirc there are a few monsters that are immune to magic entirely, but I might be confusing that with MM7 or MM8. Regardless, Shrapmetal does physical damage, so... I wouldn't bother adding more skill points to Bow once it is mastered with any character. Buff up your magic skills instead. Your knight can even just save his skill points for now if you're happy with the damage he's doing with his melee weapon(s). Those saved points will be useful later.

Your casters might be able to put some extra points in Meditation for extra MP. You can save first, increase the skill level, and then see if the extra MP is enough to justify the expenditure. If it isn't, just reload and put the skill points elsewhere. My strategy is usually to use high value spells on high value targets, and bows/melee the rest of the time. I'll periodically throw something medium strength since I make a point of having an hp regen item and an mp regen item on each character. Make sure to save some blue goo for priority situtations, like you suddenly blunder into a filled room or a nasty monster figures out how to exit the doorway and is in your face.

Make sure to keep those buff spells from Light and Dark up. The only reason to leave them off is if a monster is regularly dispelling them, in which case just keep recasting the bare minimum (Wizard Eye, Torch Light) until the annoyance is removed. Pour all the points into one of Light/Dark. I usually have a party of Knight/Paladin, Druid/Archer, Cleric, Sorcerer, so I have Cleric focus Light and Sorcerer focus Dark (or vice versa). The more you focus, the more oomph you get per mana expenditure.

I'll see about revisiting this later with your party in mind. Never too early to keep an eye on Saintly for Master Light. Best to get it done so you don't have to worry about it later, when it will be harder. One of the recommended ways I've seen is to complete the quests for the council, but don't turn them until you've got them all. Then turn them all in for the huge reputation boost and go get Master Light. In the meantime, don't dally too long in completing quests (since your reputation slowly degrades to Neutral over time) and don't murder non-hostiles or commit crimes.

You can donate money to temples (don't do it at the Temple of Baa, iirc) for a reputation boost as well, but this is expensive and can't get you to Saintly. I wouldn't bother. Master it with your Knight and have your Knight handle all merchant transactions that can go through him. Money is easy, as I recall. Go kill dragons in Dragonsand and sell their loot. Or just keep questing, clearing out every dungeon you can. Heck, get a Horseman NPC and hit the Arena for several weeks in a row if you don't have anything better to do and need to pass some time.

If you are really struggling, then swap an NPC for a banker to improve your gold income. Also, don't make frivolous purchases. Yep, that absolutely works. It gets even better in MM7/8 when GM Merchant lets you buy and sell "at cost". Buy an item, enchant it, sell it back for more money if it isn't an improvement on your current gear. :)

Raid all the shops for enchantables, enchant them, and sell them for profit. You can drop a beacon pretty much anywhere. I wouldn't bother placing one next to a tavern though since Town Portal can take you to Blackshire and you can just fly over to one of the wells that recover hp/mp. Or TP to New Sorpigal and use their temple for healing if your cleric can't handle it.

I'll use a Beacon to mark a current place in a dungeon if I need to leave (ex. I'm full on loot). I also set a few Beacon slots aside to mark areas that TP can't take me (ex. Sweet Water), or a temporary slot for a somewhat distant place where I can turn in a quest (ex. Castle Stone(?) for turning in the Cleric promotion quest when I finished it). A Beacon near Abdul's Oasis area can make turning in golden pyramids easier. A Beacon next to a Trainer (ex. Master Light/Dark) can make it easier to come back later when I've met the requirements.

aite first of beacon is for nerds, you want to pump all the points into dark / light after you gotten master in other skills you want. with a magic heavy party making the knight a proper bow user seems like a good idea, magic for the mages is obviously better though.

if your reputation is average or low end of respectable I'd recommend getting master dark on your casters first and then pumping up your reputation at a temple as you'll be able to get back to where you were easily and master dark is a pretty big boost.

Did you do Temple of the Snake?
Don't want to do too much of a spoiler if not, but you should have gotten a Lloyds Beacon (not always but usually)

PS
Just in case. Free Haven will have one. But save before knocking. Reload if it doesn't have Lloyds Beacon.

Suggested build. Feel free to not follow it in part or in whole; it's your game.

Knight
Bow - M, 8
Sword - M, 8
Master Sword allows you to wield a sword in your off hand. You could dual wield a dagger instead, but your sorcerers would already be competing for your best daggers. The Knight has enough hp and ac (plate) that he doesn't really need a shield.

Axe - M, 4
OR
Spear - M, 8

Plate - M, 4

Spend enough skill points to Master whichever Misc skills you like, then save the rest of your skill points for a skill that comes later.

If those saved skill points are burning a hole in your pocket, then spend them on either Axe or Spear (whichever one you decided to use), since that directly increases damage. Personally, I favor Axe over Spear because points improve recovery time and damage instead of AC and damage, but either one works. No point in improving both spear AND axe.

Cleric
Bow - M, 8
Mace - M, 8

Chain - M, 10
Shield - N/1, E/4, M/10. M requires 10 ranks and is worth +30 AC
Advance Shield as far as you like, but stop at a break point. It isn't worth the extra skill points to go beyond Master.

Spirit - M, 4
Mind - M, 12
Body - M, 12

Light - M, 4+
Dark - M, 4

All extra points go into Light magic to improve the bonuses from Day of the Gods and Hour of Power. All healing needs can be taken care of by Power Cure (for unconscious characters) and Shared Life (characters low on health split the Knight's excess hp).

Sorcerer 1
Dagger - M, 8
Bow - M, 8

Leather - M, 10

Fire - M, 12
Air - M, 4
Water - M, 12
Earth - E, 4

Light - M, 4
Dark - M, 4+

All extra points go into Dark magic to improve damage.

Sorcerer 2
Dagger - M, 8
Bow - M, 8

Leather - M, 10

Fire - N, 1
Air - M, 4
Water - M, 12
Earth - M, 12

Light - M, 4
Dark - M, 4+

All extra points go into Dark magic to improve damage.

-----

Magic distribution commentary:
-I'd suggest putting all your cleric's extra skill points into Light. It does have a few situational damage spells, but the primary spells are mostly cast once per day, so you can cast them at the fountain in Blackshire and immediately drink to recover the spent MP. This leaves plenty of hp for Power Cure and Shared Life.

-Stop spending money sleeping at an Inn. Find a patch of grass and sleep there for just a food cost. Don't buy food any more either; Light magic's Create Food should keep you supplied enough that you don't even need to care about sleeping on grass.

-Sorcerers can get more focus in Dark by mostly ignoring Light magic. Light Mastery is basically free at only 4 skill ranks needed, so may as well, but nothing invested beyond that.

-I like mastering all magic types for each character that can, but you can save skill points by only going to Expert Earth for one of your sorcs. Expert Earth is a convenience purchase so Sorc 1 can Unpetrify Sorc 2 if Sorc 2 gets stoned, and reaching rank 4 is a pretty negligible skill point cost.

-There aren't any status removal spells in Fire, so you can get away with not spending any points on Fire for one Sorc. You could Master Fire for Incinerate if you like; it costs the same as Toxic Cloud but the damage scales better. However, high points in Dark lets you run up to a monster and pop a Shrapmetal in their face for damage values beyond anything else. Also, high points in Dark lets you use Dragon Breath when relevant, while high points in Fire doesn't have a comparable alternative.

-Feel free to just not invest in Fire at all. The only utility spell is Torch Light, and going from 4 ranks to 12 ranks is expensive for "Brightest Light". You can get "Brighter Light" for only 4 ranks, which (again) is a pretty negligible cost. If you aren't sure whether you care about the difference in light levels, then just wait until you level up a whole bunch at once, save, invest the points to go from 4 to 12, get Master, and compare. If the difference in light levels doesn't matter to you, then reload and spend the skill points on Dark.

-Master Water is on both Sorcs for the extra Beacons; 10 Beacons can give you a shortcut to pretty much every map that doesn't have a TP spot, and maybe an extra Beacon or two on the side for whatever you want.

-Remember to only use Day of Protection from the sorc with the higher skill in Dark magic.

-----

Other commentary:
-Bow stops at 8 ranks for the double shot. Further investment doesn't directly increase your damage, so don't bother. Bows are eventually replaced by something else, so save the points.

-Armor skills go to Master to remove the recovery penalty.

Money trouble idea, while I'm thinking about it: Grab one of the Hirelings that gives a bonus to Merchant skill just before you go train, then dump them for your previous Hireling once you finish training. The reduction in training costs should more than offset the initial hire cost of switching hirelings twice.

Bookwyrm627, mate, as always, you are legend. This is immensely helpful! To be clear, I'm gobbling up all this information and putting it to use (learned a ton!) but let me reply here to anything I have something further about. This is more incidental and I am only familiar with MM6, but would you say MM7 and MM8 are worth playing as well? I just have nostalgic memories and MM6 and Heroes 3, which is why I initially installed them. Yeah, I'm liking the regen items a lot, and trying to do the same thing. As for mana pots.. is blue the only options? I mean a measly 10 mana for the space a pot takes up seems progressively measly as the game goes on and spells cost more... is there no like 'greater potion of mana' or something to get more bang for your buck? (thinking like Diablo 2 for example). damn, this is brilliant, and quest-rewards saving sounds dandy. First of all, MASSIVE thank you for this guide - it's exactly what I was looking for. Seriously, amazing stuff. A lot of this is confirming the line of thinking I was in when playing, so that makes me feel confident i'm at least 'getting' how to play the game well ahah.

This is good to know, and yeah you hit the nail on the head in that I was quite on the fence for earth/fire, but at least I see the use for earth and fire for at least expert now (unpetrify and torch light). awesome tip, I never thought of that. Since I don't have any beacon spell yet, I'll see how critical it is to my playstyle (I wish it only required 7 point master like air :))

----

again, thanks a lot! wish I could give you stars or likes or something. really helped straighten out my thinking and i think safely take me into the endgame! no not yet!
will check free haven though, thank you! that is an excellent point as well! I was thinking of vying for light mastery first and the getting dark since it's easier, but I never thought 'well my reputation is pretty mediocre anyway and I could quickly get it up at a temple if needed' for an easy dark mastery

There's some differences between each of 6/7/8, but I enjoyed all of them quite a bit. 7 is my favorite of the bunch. 8 is perhaps the weakest of the trio; NWC was in financial trouble and it shows. The game isn't really broken, but there are hanging threads where they were probably planning more stuff (ex. druid crown) and were unable to build it, and some apparent mechanics that aren't actually implemented (fame).

I'd definitely say both are worth playing, though. You can make a black potion that refills 100 MP and one that refills 100 hp. Each one ages the drinker by a year, though. There is a rejuvenation potion (which lowers stats in addition to age) and a fountain in (looks-it-up) Hermit's Isle that will lower age without the stat reduction. Looks like high ages do mess with your stats, but a few years doesn't matter.

Personally, I just drop a Beacon, TP over to one of the towns (Blackshire is my favorite), drink from a fountain to refill hp or mp, then Beacon back to where I was.

Also, looks like I have to walk something back; an Orange potion in MM6 isn't Cure Disease. In MM7 it is. It isn't necessary (you can always just travel there again the 'hard' way), but it can be very convenient for making your way to different maps and marking your current adventuring location in case you need to leave for some reason. There's also no passage of time for the transport, unlike normal travel.

It does make reaching places like Hermit's Isle, Eel Infested Waters, and Castle Ironfist a lot easier. The Adept Guild of Water (Free Haven) is the best place to look for books of Lloyd's Beacon. As MacAilpin said, save before entering and then reload if the inventory doesn't have what you want. The Adept Guild of Elements (Frozen Highlands) can also reasonably spawn one, but the shop's inventory will have spell books from all 4 elemental magics so there's more competition for space.

Make sure to grab one for each Sorcerer while you're shopping. You can sell it later if you decide you don't want to use double Water Master. Omgzed's idea is a good one if you're only sitting at Neutral-ish reputation anyway. Armageddon enough towns to tank your reputation (New Sorpigal, Mist, and maybe White Cap?), grab all the corpses you just generated all over the map before moving an area, get Master Dark, pay off your bounty/fine at a town hall/castle, then donate to a temple to improve your reputation to Respectable (not a Baa Temple!). Don't turn in any quests until you've donated to get your rep back up.

If you're saving the council quests to get your saintly reputation, keep in mind that the one that has you fixing shipping prices actually causes you to lose rep.

Bards can get you across the line for Light Magic if you have led less than a Saintly Life.
But other than a couple spells (Day of the Gods; Day of Protection), Light and Dark magic are so-so to me. Shrapmetal is okay.

Castle Darkmoor (the infamous) at level 32? Wow! That guy who asks us to destroy the Book of Liches - forget it.

I cleared the place at level 49 and that was premature (story-wise) because there was something -What The [expletive] Is This?- to be grabbed deep inside. Middle part of the game is all about earning permission to visit the Oracle. When we do, it will tell us to fetch things from four dungeons, Castle Darkmoor being one. We can destroy the Book of Liches then.

Bad news (that you may have gathered from Bookwyrm627's second post): in MM6, while every skill needs level 4 for expert, mastery requires 7 for the utility skills, 8 for the weapon ones, 10 for armor (including Shield) but 12 for magic. There are exceptions: Axe, Plate Armor, Air Magic, Spirit Magic, Light Magic and Dark Magic need only Expert skill plus (respectively) completing a quest, second Paladin promotion (not Knight! - but honorary promotions count), second Sorcerer promotion (again, can be honorary), second Cleric promotion (ditto), maximum good reputation and maximum bad reputation. In the days before internet walkthroughs and crib sheets, we had to learn this the hard way (i.e. from the master instructors themselves). [EDIT - removed question about Bow - looked up answer]

Plate master instructor is doubly weird because one of the people reachable only by using Air magic! (Fly or Jump) You could hit Mark as Solution button at the top of one reply box.

MORE ANSWERS - RECOVERY TIME
Grayface patch lets us right-mouse-button over attack number in character stat page to see Recovery time with current melee weapon(s), and over shoot number to see Recovery time with their bow. So we know how much armor slows them down. It makes sense that cumbersome armor slows down untrained people at physically strenuous things like hacking, slashing or jabbing with weapons, or drawing bows. Should it slow down spell casting too? Debatable. Does it? Less easy to prove.

WIKI
My go-to is the "walkthrough" (annotated maps rather, and crib sheets) by Mike Marcelais and J. Pike, at the-spoilerDOTcom

PLAY STYLE
I like strategy games, which are about steadily improving, and am willing to take my time (of which I have plenty to spend), so a balanced party (the quick start one) suits me. I've done things in MM6 because they are in the game, so lets give them a try, use a mixture of things rather than concentrate on "only the best". I always use turn-based combat, including plenty of melee, which does work.

"Choose a sorcerer to give all horseshoes to, and put all his (or her) skill points into Water Magic to achieve Master asap, so as to teleport everywhere (and get money by Enchant Item). Then Dark Magic is best, so teleport to the places where we can learn it, become Experts at it, then Masters at it. Once we've done all that, then we can start the game (the story). One-shot (per party member, so three or four shots in all) killing monsters is fun, slower than that is boring." That is not me. I'm the opposite of that. I went with the flow, tackling quests, maps and dungeons in ascending order of difficulty (approximately, so far as I could determine it), improving skills as opportunity offered. Dovetailing coach and boat schedules with where I could usefully do things was fun.

So on GOOD SPELLS VS MANA, and on LIGHT VS DARK VS OTHER, I go for cost-effectiveness. In the later game, my party go to an inn each evening to rest. (At New Sorpigal, the cheapest, because though only Honorary Arch Druids, they do follow the creed according to Lady Moneybags.) Each morning they spend an hour or more teleporting around wells and fountains for buffs, finishing at one where they top up mana, before heading out for their day's work. Any more buffs wanted after that, they apply individually with self or elemental magic, not the expensive Light or Dark all-in-ones. After that their spell-point-regen items (and hit-point-regen) get them through the day without need to refuel.

Part of that was having invested skill points into various immediately useful Self and Elemental magics at which they became masters, before having any Dark or Light to start being good at. I'd rather use a Fire spell (when level 12 Master which a ring with "of Fire" enchantment makes equal to 18) than a Dark spell (when level 4 Master).

That only exists if the thread was opened as a Question thread, which this thread was not.

The Rep system is mostly gone, so there really isn't much anyway.

CONTINUED

So, I quite agree. In turn based combats, targets never move, so shots are always on target (barring stupid obstacles, of course) but are still hit-or-miss, and the higher level the monster, the more likely to miss. Higher bow skill counteracts this, but does not increase damage, unlike most melee weapons. Looking at how my party finished, P C and S were all 10 or 11 at Bow skill, but then rather than one "dump skill" for surplus points, I spread them around, and Bow could have been one of the beneficiaries of that.

I do use melee a lot, so even my so-called "Archer" ended with Sword skill equal to Bow, and Spear skill higher than either. For another example, my Cleric's best skill was Body Magic, with Mace and Dark (!) Magic equal second; her Bow skill was one better than her Light Magic. (Her Spirit and Mind Magics were lower still, at the minimum for Master and Expert respectively, but she had them only as spare wheel to my Paladin.)

Late game - which level 32 most certainly is not - with my Paladin as first choice for curing ailments, and with my mana-regen items, my Cleric had mana to spare, and more to gain from Dark Magic than my one Sorcerer had. Him I left at level 1 in Dark, but even better than my Cleric at Light. Was that for Destroy Undead as much as anything, and if so, was it a waste (does Castle Darkmoor have the last undead we meet)? Slow is pretty useful too (in MM6 it is a Light spell) except when monsters are immune.

The more skill in any magic, the more damage its damage spells do.

Fire magic is best for AoE.

Shrapmetal, indeed any shotgun-style multi-shot spell, works best when the monster is right in your face. If getting that close, let your Knight melee. Two melee weapons beat one bow, and even with only one (e.g. Cleric with Mace and Shield) Might stat increases melee damage but (unlike later MMs) not bow damage.

BY THE WAY, I DO HAVE A PROBLEM - DO YOU MIND SPOILERS, OR WANT ONLY HINTS?

BEST WAY TO GET TO SAINTLY?

There is one quest {coming up/some way ahead} that, on its own, will get you there from Respectable. (Reputation decay over time may not work when travelling or training, only when adventuring and resting, but if you are borderline Saintly, and worried, then hire a Bard.)

Once safely Master of Light, there are other ways than killing innocents to trash reputation. We get treasure from chests. We can also put our own stuff into them (after claiming the treasure) and it will be safe until the map or dungeon resets, which in most cases means for 24 in-game months. Should have kept those bones from the Bootleg Bay cannibals' camps and temple.

If you must Armageddon a town, nobody deserves that, but in my opinion White Cap people are not quite as undeserving as the others.

LLOYD'S BEACON
The shrine-of-the-month permanent boosts make little difference late game, but if enough of a completionist to want them, then leave a beacon at Castle Ironfist so as to visit the Seer for pilgrimages. Castle Ironfist is NOT a town for Town Portal purposes. Blackshire is (but I do not know why), Free Haven (High Council) and the three with Town Halls.

I do not understand. How does putting treasure in chests harm your reputation? Are you solely referring to the bones? If so, what do you have to do with the bones to decrease your reputation?

Bones: Sell them in Free Haven Bad Mojo

Castle: If there is a castle in a town there is no "tower' to shoot down dragon riders.
If no castle, then there is a tower. (Castle can be nearby. But the designers seem to see a difference if the Castle was part of the town--- or near it) (Sorry. Towers and Fountains for Portal seem to go together. Forgot to mention that part).

FREE MONEY with Enchant Item
"The chance of success is 10% per point of skill." What the description doesn't say:-
- if the spell fails, it breaks what it tried to enchant;
- attempts to enchant junk (low-level) items always fail;
- attempts to enchant something that is already enchanted do not break the item, but do use up spell points;
- same with attempts by a non-master to enchant a weapon.

[continued by EDIT]
MASTER MERCHANT FOR EVERYBODY?
I did, but then they ended up as milllionaires, more-or-less. Each.

Merchant for everybody the first evening in New Sorpigal because it is cheap and soon pays for itself as they buy other skills and train.

Some gyms (training centers) charge more than others. The cheaper ones cap out at lower levels. Cheap or expensive, each successive level costs more, promoted characters pay double, and the twice-promoted three times the base price. So maybe expert merchant after one promotion or the other.

POTIONS
Want better blue potions? Play MM7 or MM8.

Make blue, red and yellow potions by adding reagents to bottles. Make green, orange and purple potions from combinations of the first three (right click one bottle onto another). Make white potions from combinations of the first six (the order doesn't matter) except that some combinations make explosions. Not random, some pairings work always and others never. Make black potions (or explosions) from one of the first six with a white.

GAS STATIONS FOR MANA
As should be apparent from earlier answers, almost every fountain and well in the game does something when somebody drinks from it. Some good, some bad and some both, but only to the one person drinking. "Refreshing" means either its magic has run dry (temporarily) or the drinker doesn't qualify (e.g. no spell point top-ups for a knight! but anybody else already at max wastes the benefit; permanent stat boosts can be had several times running but only when the stat is below a limit).

LIGHT MAGIC
Maybe I did use Hour of Power regularly. Of all its components, Haste doesn't last as long as the rest (1 hour, plus 5 mins per skill level) so then I'd recast that on its own with the Fire spell (when wanted).

DARK MAGIC
Useless against oozes, surely? There's always something.

So keep them until you WANT Bad Mojo. Use chests for extra inventory space.
Yes. So I forgot White Cap (Frozen Highlands).