What you saw was a sword, not an athame, young Wizard.
There are tabs in your backpack, one of them is for Athames. It does not show up in your hand as an Athame is not for battle use. The Athame's primary use is to direct energy which is why your Athame will increase your stats in some way.
Swords on the other hand, are listed under wands and act like a wand, which means they do show up in your hand and grant spell cards.
You get swords at a certain point in the game. If what I see in the Bazaar is correct , then you get them about level 50. They are also available as promotional codes in magazines. You get the code out of an issue of a magazine and use it at the Wizard101 sight(this one) to redeem it.
Whatever you do though don't ask for the codes in game. The only codes you get from people in game are rip-offs. Them giving you a code that doesn't work in an attempt to get something out of you.