It's hitting "R" for rest that gets him to cough up the potion. I tried resting overnight at the inn the first time and he didn't give me the potion, so "R" is the way to go 
I've been spending the last couple of days running around the place trying to get my characters upgraded, this game really makes you work hard for your promos! Finally managed to get two mercs and a healer, but I'm still stuck with one initiate.
One of the annoying things about the game is that it doesn't tell you enough stuff about the quests in the journal, so I forget which quests are for what. I must have 30 quests lined up to do ATM.
BTW Who said Paladins and Rangers are underpowered in this game? It was only after I upgraded my two fighters to mercs on that advice that I noticed Pals and Rangers can upgrade a whole bunch of useful skills to Grandmaster that Glads and Assasins cannot. In fact Glads and Assassins can only upgrade to expert level bow, and if MM8 is anything to go by, bow skill is vital to this game!
