In any case you need the Community Patch 1.6 - that is correcting the most issues and is common ground for the modders working on it.

After that the modders have split in development but are still working (as far as I know) on 2 different mods. Each of the 2 guys has a different point of view and thus have created competing mods. DON'T USE BOTH MODS. You have to decide on one mod to go on.

The more basic one is the S2EE mod for "Sacred 2 Enhanced Edition". According to the definition that I learned it is basically a version that "restores" the intended function AND offers some improvements which can be selected or not. I would call that the "vanilla" version + some additional options. (The main modder for this version is Flix on the Dark Matters forum.)

The more "aggressive" mod is the "Patch Optional Addendum" (by Dimitrius on the Dark Matters forum). As far as I know some changed DLL files are included.

Thus you need to check those patchnotes on the Dark Matters forum and than you decide among 3 options:
1. use the CM patch 1.6
2. do 1 and use S2EE (choose which of those options you want to use)
3. do 1 and use the Optional Addendum
Follow the instructions according to your choices.
Again: DON'T DO STEP 2 AND STEP 3. ONLY USE ONE OPTION.

BTW I'm not part of the modder team. Just a player who loved the game and bought it back when it was new.
The modders are still working together, but they have different opinions of which way to go. Both ways are somehow justified, but YOU are the player and YOU make your choice. You have the options: use them!

Source: darkmatters.org

PS You need to start NEW characters, as those patches might mix up existing characters.