I entered Level 6 and found and used an Anvil of Krong. I proceeded a couple of rooms down and found another anvil. This one already had the broken graphic, and the tooltip said "this Anvil of Krong has been defiled". I've never seen this before in all my months of playing DoD. More curious still, when I then found and used a third Anvil of Krong nearby, this defiled anvil magically reverted to being an ordinary unused one. Bug? Undocumented feature? Krong finding new ways to mock me? All of the above?
Found another one on Level 7. It's the broken (rather than expended) graphic, and the tootip reads Corrupted Anvil This Anvil of Krong has been shamefully defiled. Edit: I just killed some monsters next to the anvil, and it got repaired with the log message "Praises to the faitful adventurer, the shrine is cleansed and Krong may reward you! Or not." Turns out it's a feature of some sort rather than a bug. (though that comma is grammatically incorrect)
I have to wonder if the "Krong will reward you! Or not" part is a) just a description, or b) actually refers to code that increases the chance of Krong giving you an upgrade for killing the defilers.
Not a bug afaik. If you kill the monsters that are in the same room as the Anvil of Krong its defiled status will change back to the "normal" one and you can use it to power up your items.