False Blood Amulet

[Kalriostraz]

I've been trying to figure out exactly what this does and allows, but keyword especially is vague. f.e. Having the Living Construct keyword, it sure would be beneficial to me if I counted as one and didn't have to eat, drink, or sleep. I doubt this is a correct function, but things are rather vague. Any light to be shed on this item would be much appreciated.

[Kurald Galain]

I see no problem allowing that. But yeah, it's vaguely worded.

[darkbard]

It was designed for Eberron to specifically allow a Changeling to better pass itself off as a member of a different race. When taken out of that context, yes, the mechanical benefits become a bit hazy. Note, too, that RAW it doesn't scale; i.e. there is only the L7 version of the item.

[Herobizkit]

IMO, keywords refer specifically to meta/mechanical effects and how in-game objects interact with them.

Having the Living Construct keyword would benefit you if you, say, found a Graft that can only be worn by a Living Construct (which would have the LC keyword by virtue of Race).

Another example: having the Elf keyword would benefit you if you found a magic sword that has special powers if wielded by an Elf (which would have the Elf keyword).

I read on the rpg stackexchange that keywords are explained on p.55 of the PHB.