How do you use potions during combat? I'm unable to equip them or see a use command.

In 6+7, you use the "USE" command and select the potion. Potions can be used on any character, rather than just on yourself.

In 8, you select the "hand" icon next to the portrait (or use the "use" key defined in the options) and you'll see a list of the items in your inventory. Note that you cannot use potions in your shared inventory during combat, you can only use items in your personal inventory. You can also only use potions on yourself. (This is why Cure Paralysis is a powder and not a potion.) Alternatively, with a potion in hand on the cursor inside the inventory menu, you can click the "use item" button on the bottom of the screen, which will quit out of the inventory menu and use the item.

You can get items from the group back-pack during battle in Wizardry 8 but it takes up your (i.e. that characters’) combat turn.

Thank you for the info. I forgot you had to have the potions in the toons pack before you could use it during combat.

Using the hand icon doesn't help me for some reason.

In combat, I select the Hand and the Use icon, and that icon shows up as the character's next combat move, but when the time comes for the character's move, nothing happens, no opportunity to select a potion. I'm at a point where I have to know how to do this before I can go on with the game. What am I doing wrong?

If you're selecting the "Use Item" action (and not the "Equip" action - they're easy to get mixed up) then you need to select the potion from the list that appears in the combat text area. (This is also where bards and gadgeteers activate their respective devices.) It's not something you do at the time the character's turn actually comes up.