Drake Scales are a rare item dropped by the Drake family of monsters located in the Mountainside Caverns while doing the quest The Urn of Sacred Ashes. There is a finite amount of scales (6, however it is possible to get 7 or perhaps more) to be found, which can be traded in for two sets of armor at Wade's Emporium. A seventh Drake Scale can be obtained by accepting to help Kolgrim, and then killing him once he speaks to the High Dragon.
History
Drake Scales can be given to Wade in Wade's Emporium in Denerim to receive a set of Wade's Drakeskin Armor and Wade's Superior Drakeskin Armor.
Locations
Drakescales are found on drakes in the Wyrmling Lair during the quest for the Urn of Sacred Ashes.
A total of 6 (7 if you lie to Kolgrim and betray him outside on the Mountain Top) such scales can be found in the lair if it is fully explored. This is enough for 2 sets of armor (The basic and the 'superior' set).
Three Drakescales can also be found in the Circle Tower on the fourth floor. One Drakescale is found on the single Drake in the tower. The other two are in a locked chest past the door immediately after you encounter the Drake. A seventh can be found on a Drake after it is slain outside the Mountain Top near Kolgrim. An eighth can be found in a random encounter which also includes three Blight Wolves and a Bereskarn.
A visit to Wade will ensure that the scales are put to good use.