Found a nice introduction write up about the cultivation system in Age Of Wushu. I think it's fair to say that the game takes some getting use to and can be a bit daunting for newcomers.

Thanks to Greyvent for in introduction.

Key Words to Remember:

Experience: is the main source of your cultivation process. you can have up to a max of 999 exp. 1 exp can be converted into 1000 cultivation points. Non-VIP can only convert 70% (1 exp = 700 coultivation points) and 30% (300 cultivation point) will be stored as potential points. Potential points can be converted into cultivation point by purchasing it using cash shop money (Gold).

Tips: Best way to gain Experience point is to do "School spy" daily quest. (Max 5 times per day)
You can get a max amount of 160 EXP when you successfully completed the quest with 10 intelligence. (800 EXP in total if you completed 5 x "School spy" quest)

Conversion Rate:

The maximum amount of conversion in general for VIP is 380 cultivation points per 100 seconds.

The maximum amount of conversion in general for Non-VIP is 266 points per 100 seconds. 

There are other ways to increase the conversion rate:
School Patrolling Task (Increase by 10%)
Guild Patrolling Task (Increase by 30%)
Divination (In the range of 10% - 450%, depends on your luck in fortune telling, 6 times per day)
Experience Medicine ( e.g. Jack Dew(25%), Yellow White Pill(50%), Chi Accumulation Pill(100%), Palpitation Relieving And Vital Pill(150%), Green Pill(250%) | However, these pills can be consumed for a limited amount per week. Up to max of 35 x Experience Medicine per week)

• -Jack Dew can be obtain by completing the JiangHu instances, Forbidden Instances, or School Spy quest.
  -Jack Dew can be refine into better pills with better bonuses by using Herbalist Life Profession.

Now that you have some idea of how the gaining of cultivation point process works, we'll move on to the next topic on how to use the cultivation points.

Cultivation:

Cultivation is the process of leveling up your martial art skills or inner skills.
You can only cultivate one skill at a time.

Cultivation Process:
There are 3 ways to cultivate your skill: 

1. Internal Cultivation:

The most basic out of the 3 method. 
Click it and you will Consumes 43 cultivation points every 15 seconds in general.

Of course, the consumption can be speed up if you're in a sacred place according to the element of your skill.
Consumes 45 points every 15 seconds (2 point bonus) 
Consumes 44 points every 15 seconds (1 point bonus)

Element of skills:
There are 3 types of element for "Inner Skill":

• Tai Chi: Wudang, Blissful Valley
  YinSoft: Emei, Tang, Scholar
  • 2 point Bonus : Mountain Sacred Place
    1 point Bonus : Cave and Snow Sacred Place
  • 2 point Bonus : Waterfall Sacred Place
    1 point Bonus : Cave and Snow Sacred Place
  • YinSoft: Emei, Tang, Scholar
    • 2 point Bonus : Waterfall Sacred Place
      1 point Bonus : Cave and Snow Sacred Place
    
    YangHard: Shaolin, Beggar Sect, Royal Guards
    • 2 point Bonus : Forest Sacred Place
      1 point Bonus : Cave and Snow Sacred Place
  
  
  • There are 5 types of element for "Martial Art Skill":
    • Tai Chi Martial Art Skill
      • 2 point Bonus : Mountain Sacred Place
        1 point Bonus : Cave and Snow Sacred Place
      
      Yin Martial Art Skill
      • 2 point Bonus : Cave Sacred Place
        1 point Bonus : Mountain and Waterfall Sacred Place
      
      Yang Martial Art Skill
      • 2 point Bonus : Snow Sacred Place
        1 point Bonus : Mountain and Forest Sacred Place
      
      Soft Martial Art Skill
      • 2 point Bonus : Snow Sacred Place
        1 point Bonus : Mountain and Waterfall Sacred Place
      
      Hard Martial Art Skill
      • 2 point Bonus : Cave Sacred Place
        1 point Bonus : Mountain and Forest Sacred Place

2. Practice Martial Arts:

You can speed up cultivation by using this method, however you're limited to spend 50 Liang (Bound money) per day.
You can also use Unbound money to speed up your cultivation, however you're limited to 150 Liang (Unbound money) per day, and if you will be charged more if you go over the limit, which is also limited but by week. 
Sounds complicated huh? 
Tip: Just stick to the unbound money limit.

3. Team Practice (TP) :

The is the best out of all 3 and most rewarding, however, once your "Fatigue" reaches 100%, you can no longer consume any cultivation points.

There are 4 tpye of Team Practice: 10,15,20, and 25 rounds
Each Team can have up to a maximum of 10 members (Recommended to train with 10 for the maximum amount of rewarding consumption)

The bonus for TP works similarly to the "Internal Cultivation" as well.
If your TP happens to be at a sacred place, you will gain bonus consumption if the skill you were training matches with the sacred place.

TP is most rewarding when everyone in group does it properly and ends it without a single miss.

The more "miss" you have in your TP, the less rewarding it is.

Also to point out, the first person on the list have the easiest key, and the last person on the list will have the toughest key combination. So make sure you have someone who knows what they need to do when they get arrange down to the bottom of the list.

Team Practice uses ← ↑↓→ J, K key. (You can substitute WASD for the arrow key as well)
You have limited amount of time to complete the combination of the keys showed on screen when it's your turn. Press the keys accordingly from left to right as shown on your screen.
If you press a wrong key by mistake, you'll have to start over.
If you fail to complete the key combination within the given amount of time limit, your team will not consume any cultivation for that round.