To obtain the Battered key after losing it, you can go to the house opposite the anvils and search the bookcase. After selecting the option "Click here to continue" the key as well as a Slashed book appear in your inventory. Duplicates of the key can be obtained by dropping the key and retrieving another from the bookshelf as the key does not have the 'destroy' option. However, you can only add one Battered key to your steel key ring. This key can be placed on the steel key ring.