creatures not returning items
 

If you give a creature an item, and then kill it, it does not return the given items.

I started using this tactic with charm (make duel wield, lower mr) early Kunark on live after hearing about it pre kunark.

bump, tried again still doesn't work.

Is this broken with intent to prevent exploits. Should I give up hope of using a charm kit?

They know. It is broken for the foreseeable future.

This will be fixed one day.

It requires an overhaul to quest scripts, specifically as to how Multiquesting works. When we discover the very best way to proceed, this is one of the positive side effects which will come of it.