With this quest you change Mystic Turbans into Blue Pieces of Cloth, Green Tunics into Green Pieces of Cloth and Red Robes into Red Pieces of Cloth. You can do it as many times you want.
If you got any of these items to make the exchange you need to find Irmana. She is upstairs in the Dress of Success building here:

Irmana can be found at the higher floor. She can make Pieces of Cloths out of Mystic Turbans, Green Tunics and Red Robes.

Blue Pieces of Cloths
By trading 1 Mystic Turban with her you can get a Blue Piece of Cloth. Just talk with her like this:
You: Hi
Irmana: Welcome to the house of fashion, player!
You: Mystic Turban
Irmana: Would you like me to fabricate one piece of blue cloth from your mystic turban?
You: Yes
Irmana: Here you are!
You: Bye
Irmana: Good bye, player.
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Green Pieces of Cloth
By trading 40 Green Tunics with her you can get a Green Piece of Cloth. Talk with her like this:
You: Hi
Irmana: Welcome to the house of fashion, player!
You: 40 Green Tunics
Irmana: Would you like me to fabricate one piece of green cloth from your 40 green tunics?
You: Yes
Irmana: Here you are!
You: Bye
Irmana: Good bye, player.
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Red Pieces of Cloth
By trading 1 Red Robe with her you will get a Red Piece of Cloth. Talk with her like this:
You: Hi
Irmana: Welcome to the house of fashion, player!
You: Red Robe
Irmana: Would you like me to fabricate one piece of red cloth from your red robe?
You: Yes
Irmana: Here you are!
You: Bye
Irmana: Good bye, player.
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