Yea, the item drops that are in the game are color coded.
Grey = semi junk. good if you dont have anything, but, there are LOTs of things better. if its grey and not equipment, chances are its just smash fodder.
White = not to bad on equip. if a non equip drop is white, then its probably used in some kind of a craft or used for something by a Player. good to sell if you have a lot of the same item. but for equip, its good to have but, again, there are better.
Green = Now your gettin higher on the list. Decent stuff, very well worth buying if its not bound to the person (more on that in a sec), and if you find one, expect to be really happy. I dont belive there are many if at all items that are green and used in tradeskills, but, i very well could be wrong as i havnt payed much attention. Quite a few are "Bind on Equip" with some "Bind on Pickup" (again more on that after the color code)
Blue = Blue items are usually the kinda things you want. Excellent on stats, main problem with them is that quite a few are now "Bind on Pickup" so if you want these, you gotta pray they drop for you.
Purple = havnt seen any of these since the latest push, but, i saw a couple before that. These are the Rarest of the Rare. I saw a godlike sword that was purple being sold for 500 gold (100 copper = 1 silver, 100 silver = 1 gold) and it was going up in price as i left the zone.
Now, for the "Bind on Pickup/equip" aspect.
"Bind on equip" = You place this item on your character to use it, its yours and yours only. The only way to sell this is to a vendor after you equip it. Feel free to sell to other players to let it bind to them if it doesnt do any good for you.
"Bind on Pickup" = Once you pick this up off of a monster, you can only sell it to an NPC vendor. either that, or throw it away. (sell it if you know whats good for ya, aka MONEY).
I actually found three items today that were "Bind on Pickup". I was with a team, and i was the only one that could actually use the three items. I got new shoulder pads, a new staff, and a sword so that if i get silenced, i can actually do some damage with a weapon. I was in a special zone, and its known for items like that, we saw 3 more items that were all the "Bind on Pickup" (BoP from now on even though i doubt imma type it again). One was a two handed sword that the warrior in the group could use, another was a killer ring that really wouldnt have helped me, but, the mage said he needed it, so, we all said "Go for it!" the third item was some kinda chest piece that would have been good if i didnt have my Robe Of Power.
Theres your basic rundown.
Ksetrat - Warlock 70
Xantcha - Warlock 60