Can I make a RuneWord out of a magical or Unique, Set, Rare, Crafted, or Magical items?
No, items must be normal or superior socketed items, (grey colored-text names) to make a RuneWord from them. You can find or make the socketed items with the socket-adding quest in Act Five. Note that some Uniques and all the items in the Griswold’s Legacy Set have two or more sockets in them as inherent properties, but none of these can become a runeword. Neither can magical or rare items with two or more sockets.