Lathing is the process with which to create handles for swords. Over time, wooden sword handles will be used less, the master level smithing book will contain no swords that use wooden handles. However, arrows will always be relevant, and thus will be the lathe.
To use the lathe, place a wooden block on the lefthand spikes and use the handle to close the distance to the other side. (Arrows will not need this adjustment)
Place the required blade in the middle of the slots in the beam with the holes. To remove a blade, you have to grab at the base of it, not at the blade itself.
Spin the righthand crank until you either succeed and can take the handle / asrrowshaft, or the wood breaks and allows you to place another piece.
Lathe, as it appears in the game.
All blades currently available for the lathe.
Blades in order of appearance, starting from the upper left: