He's talking about handing in quest items and being indifferent to the mob. Wood elves have racial hide and can do this.
You can hide after opening the trade box and it won't break hide when you click trade. Additionally, if you have a friend who can cast invis or ivu on you while you have the trade box open, you can do indifferent turn-ins with any race/class.
So it's really not all that advantageous to play a smelly hobbit.
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