I tried using one at the Vesper Blacksmith and it said I had to go to a blacksmith shop. I tried a few towns, and only had luck by going to Britain's northern shop by the graveyard.
There are some shops out there that don't recognize the repair deed. Most common shops in the popular towns do though. I reported that Vesper one a week or so ago via PM.
the deeds only work in the shops with the forge and anvil that are actually located INSIDE the building
Currently the repair deeds need to be used within 12 tiles of a blacksmith or blacksmith guild master. Eventually we will change the deeds to work based on proximity to the shop itself.
No, they work in Ocllo too. They only work in close proximity to a blacksmith which sells ingots. Do a "vendor buy." If that blacksmith doesn't sell ingots, then he won't repair your stuff either.