I had the same problem with my last character, turns out I had simply missed a cupboard in Bowerstone North

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Just make sure you raid all the houses in every village and all the guild bookcases (including the ones in the demon door, just turn on your lamp to open it). Don't worry if you can't get into the orchard farm house, it's only open during the trader escort quest, and the book you get from there (The Rotten Apple) is "too advanced" for the teacher's purposes.
You can tell that he's given you the key by the fact that he doesn't mention books anymore, he just turns into another village idiot (usually with a heart above his head).
More info
here and
here.