Inventory within the game is only usable by Mario and is very limited as there are only 10 slots. Quest items, such as keys are kept in a separate inventory so you never have to worry about items needed for the game. Items can be broken down into two basic categories. Items that heal you and items that cause damage on your opponents. Since combat items can only be used once and generally are not powerful enough to wipe out your opponents, I found the combat items fell into a use them if you find them but don't bother buying them category. Healing items are much more handy. These tend to either restore Heart Points or Flower points. A few items will heal both, but these tend to be items you make by going to Tayce T. the cook.
Cooking is a really interesting aspect of the game. You give one item to the cook and get a different item in return. This can be coded by using a simple table. After you find the cook book, the cook can use two items. This again can be done using a simple table look up. What makes cooking interesting is the simple fact that by combining a HP healing item with a FP healing item you will often end up with an item that restores both FP and HP, which is good as you then need fewer inventory slots.
The ten inventory slots, while filling up quickly, are supplemented by 32 extra slots that are available by storing items at store. What is really nice here is the fact that you can put stuff into storage at one store and reclaim it at another store. This means that you can make a large pile of Shroom Steaks (a life shroom and a mushroom) and put them in storage. There happens to be a store in Bowser's Castle so you can withdraw these steaks just before you go into the final boss battle.