When:
Steelman pretty much encompasses the entire game.
Where:
Only in the wilderness.
What:
Steelman is a quite hard challenge that really changes normal gameplay. The object of Steelman is to survive in the wilderness. You must do this until you reach level 50. This is alot like Eternium-man with the SMC. When you start out, you may wander wherever you want in the wilderness, but you may not enter any towns or caves. You can wander wherever you want in the Drakalor Chain this way. The thing that makes this more difficult is keeping from starving to death (if you do not have survival skill), and staying alive. This may not sound very hard, until your level 7 hurthling archer runs into a lone swamp hydra. The lake and river are considered wilderness, but you may not enter the Water Cave. This challenge also takes a lot of patience, since after you get past ~L20, it may become somewhat boring to just wander around fighting.
How:
I would choose a character with the Survival Skill, to avoid starving to death. A hurthling may be a good choice, from initial Level 4 rock throwing skill (if you can find rocks afterwards). I would avoid the swamps until I was pretty experienced, and stay away from hooded figures.
Variations:
1. Make Kranach the Raider Lord your first kill. I realize you must talk to Twat Pare to do this, so you can make an exeption in this case.
2. Never use any equipment whatsoever. No weapons or missles, either.
3. Enter above-ground structures, excluding Terinyo. This includes the TOEF, the Mad Minstrel's Hut, the pyrimid, etc.