The quest victory involves gathering the 5 pieces of the Titan's Forge (Adventure/Domination techs) and reassembling them.

Diplomacy is victory through alliance or a combination of alliance/conquest.

The spell of making involves researching through the Magic tree to get the spell of making, then researching the spell itself and casting it.

As I completed each step, it highlighted the next one on the map for me.  I've certainly had quest locations appear in enemy territories, which makes things interesting, I'm just not sure if that also applies to locations for the quest mastery victory.  I don't see why it shouldn't.  IIRC, the first one is very close, and down a well, very easy to get.  The later ones seemed to appear farther away and were more well-guarded.  Bring friends.

It's a global spell.  I think the spell itself is called "Spell of Making".  I think there's a small chance of it coming up as you near the end of the magic tree, each time you finish research.  The techs are color coded, and that one is brown, meaning it's one of the rarer results.

Getting the lore tech is the first step, then you need to learn the spell itself from the arcane side.  That's the time consuming part. 

It took about 20 essence to cast.