Actually guys....
I know a method of how iths were made. It involved a matrix hack.... and to not get too into detail of the computer mind, i can explain briefly.... At one point, all the items in the current game area were stored in a single matrix for easy access by the game to manipulate data. Remember how the store used to have all the same items unless u left town and came back? But now the store generates new stuff everytime you open it... that was part of a fix to this hack. By finding an item ID in existence, no matter where it was in the game ( somoene's stash, the store, your cube ), you could send a buy packet (33 i believe ) mixed with the item id to get the item. Same went with runes inside weapons, when a person put an item on screen, you could sniff the item ID of the runes inside the weapon, and then buy the rune doing the 33 packet, the rune would be removed from the item, and put in your inventory....but the "runeword bonuses" would remain the same. So you could buy all the runes out of a weapon, and then it would become Ithed. The reason for the letters i believe were something to do with the default letters to display when the runewords were generated, which i believe changed in a patch, had something to do with initialization of the name..... that was atleast one method to creating iths....it was also along the same lines of the gheed dupe also, i havn't played diablo in awhile...so i don't know how the new methods are done, so don't ask....