ToME: the Tales of Maj'Eyal

Does it improve if you wait to talk to her father until you're a higher level? That is, if you come back at 50 do you get a level 50 item?

I'd like to know this too.

The town will update with your character level to a point, but by the time to finish the Melinda quest line you should be around the maximum already, so there's probably little advantage in waiting to claim the reward.