The book of portraiture is a quest item and has no use other than the one involved in Zogre Flesh Eaters quest, in which it provides a hint to the player. It is found, along with charcoal and a piece of papyrus, in the drawers in the room of Sithik Ints.
By following the book's directions with the piece of papyrus and charcoal (but not necessarily the book) in the player's inventory while in Sithik's room, the player produces a Sithik portrait.
The book cannot be placed in a player-owned house bookshelf.
All interested artisans should really consider taking up the hobby of portraiture. To do so, one uses a piece of papyrus on the intended subject to initiate a likeness drawing activity.