Right now in the beta, you can outfit your sovereigns and champions with different items of weapons, armor etc, but there isn't much of a this-or-that choice in this system because you just want to give them the items with the highest bonuses.
I don't know how much of this is new and how much is already planned for the game (since I can only see whats in beta), but I would like to see more items you can equip characters with that aren't necessarily combat related. So a character might equip wands and wizardly robes that give magic related benefits, formal clothes and badges of office that help with diplomacy and recruiting heroes and so on.
As it is, when I started my second game in beta 2 with Lady Procipinee as sovereign, I had no reason not to visit the item shop and exchange the ladylike clothes for unstylish leather armor and swap her magical staff for a sword. When that was done, she looked exactly like Lord Markinn from my first beta 2 game.
I see two potential problems with the inventory system I'd like to see addressed.
The first is that, even after the systems for magic, diplomacy, and so on are implemented, all the players will prefer similar equpment "builds" for character specialties. Thus all the magician-types will look alike and all the diplomats will have similar items, just like all the characters are built as warriors now.
I think that this will happen if the choice between items is more of a quantitative choice between items that are obviously better or worse for the same purpose, rather than a qualitative choice between items that do different things. Given a choice between a +2 bonus and a +4 bonus, everyone will take the +4. But if one item gives a +2 bonus to fire spell effectiveness and another lowers spell mana costs by -2, then different people would take different things each time.
So I hope that the content will have a minimum of items that do similar things to different degrees (i.e. different quality levels of the same kind of item) and a maximum of items with different effects where one is not obviously more powerful than another. This can lead to the second potential pitfall, which is a little harder.
Right now, characters can take lots of different items and switch between them freely. The problem with this is that players can simply take all the different kinds of items they can on their characters and swap them every time they cast spells, enter battle, do negotiations etc.
So every character can potentially be equipped to do everything in the same turn, when the point of the item system is supposed to be to 1. Add interesting choices in how to equip and specialize your characters and 2. Individualize the characters so that they aren't just faceless chess pieces.
There's no strategic decision-making if you can accumulate a big inventory like in a Monty Haul RPG. It just becomes a repetitive matter of remembering to equip your fire wand every time you cast a fire spell, switch to a water wand to cast a water spell, then to your best weapon for a fight. Multiply this by several item slots and you can spend most of the game reequipping over and over again.
So I think that implementing some limit, or some kind of trade-off, on how many items you can have and on when you can switch between them would make the system much more interesting.
I hope that's food for thought.