A great game that was improved greatly in comparison with its prequel, so good job on that. There's more to do and leveling up and earning money is more feasible. The plot so far had been interesting, and, as such, eagerly await the sequel.
The only advice that I would have is changing how easily the earlier inns are traveled to or make it so that all the inns increase to a set price as the game progresses because in all honesty, I just use the first inn since it's the cheapest. If you are keeping the different prices, you should make it so the player has to travel there by passing through the earlier towns or a la Final Fantasy, by walking around the overworld (I see you are including one from the comments) to the previous town.
The only trouble I am having is finding the heat steel. I have fought in different areas repeatedly, but have yet to even come across it, which is rather frustrating (so much so that I took a few days break from the game). If you could point me in the right direction with that, it would be much appreciated.
Thanks again for the great game and good luck with the sequel.