Polished Agates are impossible to come by just like that. Do get them you must first find Agates.
Agates are rare to find and can be extracted from Copper Ore/Tin Ore Deposits found all over the place. The best way to get them is, when you can, join the Armoured Crafting and buy the necessary tools which will a allow you to extract the Copper/Tin from the Deposits.
When you find an ore you need to double click it and you will begin extracting. If your lucky you will find Agates along with your Ore.
You can also learn the ability to show the Copper/Tin Deposits on the radar (they will appear as blue arrows pointing you to your destination - the Deposits).
You will notice at first that there aren't many Deposits around (this is mainly because if another player mines it before you it will disappear for a while - not sure how long). HOWEVER if you go to The Shire you will find an abundance of Deposits all over the place. With the ability to detect them on, you can find them very easily.
However finding the Agates will still be pretty difficult, but with so many ores around, your chances of finding them will be higher.
Once you have gotten the Agates, you will need to go to a jeweller to turn them into Polished Agates.
Before you sell any items with "durability", be sure to use the Repair All option before selling, as doing this will increase the value of the item, netting you more money in return. Repairing only takes a couple of coins, but in return you can pretty much get a lot more back.
Any items that you can equip onto your character will have a durability rating, and the durability will fall as you battle and get injured. Note that even if you haven\'t gotten an item equipped, the durability will still fall and so it will still need to be repaired.