From Diablo Wiki
The newest and perhaps coolest recipe of all for the Horadric Cube was added in the v1.04 patch, and allows you to make new Rares of many types of items. The recipe is 6 perfect skulls with a Rare item, so the Rare has to be 3x2 or smaller, to leave space for the skulls. Therefore no spears of any kind (including Lances), no Gothic bows, no Polearms, etc. Armor and many weapons will fit, and all smaller items such as rings, amulets, gloves, boots, belts, and helms.
One important thing to remember, you can't do this with ANY type of sword, since the other recipe, (6 gems of any kind with any sort of magical sword = a socketed long sword) takes precedence. Unknown if this will be fixed, but it would be nice.
This is a potentially great recipe, since the Ilvl from the affixes on the resulting Rare can go up to 100, meaning that any prefix or suffix in the game can result. Prismatic on rings and amulets, +2 on amulets, Kings on weapons, etc. Six perfect skulls can be hard to come by, but the potential for a great item is very strong, and with the Ilvl = 100, you can get stuff you couldn't gamble until Clvl 84, and you can't gamble exceptional items at all. However you might get a really crappy item as well, it's all the luck of the draw.
The formula is Ilvl + Clvl x .4 = new Ilvl.
Ilvl 90 + Clvl 4 x .4 = 36 + 1 = Ilvl 37
Ilvl 37 + Clvl 4 x .4 = 9 + 1 = Ilvl 10 (which is way too low for any useful mods)
Ilvl 90 + Clvl 80 x .4 = 36 + 32 = Ilvl 68
Ilvl 68 + Clvl 80 x .4 = 27 + 32 = Ilvl 59
Ilvl 59 + Clvl 80 x .4 = 24 + 32 = Ilvl 56
Ilvl 56 + Clvl 80 x .4 = 22 + 32 = Ilvl 54
Ilvl 54 + Clvl 80 x .4 = 22 + 32 = Ilvl 54 (Ilvl stabilizes here, after 5 trials
Ilvl 90 + Clvl 99 x .4 = 36 + 40 = Ilvl 76
Ilvl 76 + Clvl 99 x .4 = 30 + 40 = Ilvl 70
Ilvl 70 + Clvl 99 x .4 = 28 + 40 = Ilvl 68
Ilvl 68 + Clvl 99 x .4 = 27 + 40 = Ilvl 67
Ilvl 67 + Clvl 99 x .4 = 27 + 40 = Ilvl 67 (Ilvl stabilizes here, after 5 trials)
The Ilvl will always drop somewhat, and stabilize at 67.5% (roughly) of your Clvl after 5 trials. So you want to use your highest level character, and you can never get +2 skills on a rare amulet with this recipe, no matter what Ilvl and Clvl are involved. The +magical level bonuses on Circlets are added at the end. These don't effect the Ilvl, just add to the max potential Alvl. So an Ilvl 67 Tiara would get the +13 and be Alvl 80, equivalent to an Ilvl 80 item in terms of potential mods.
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