Mountain Path and the Lahan Incident
Items found in the path: Bird Egg, 2 Aquasols, Spider.
Move up to the tree near the sign and jump on it to get a bird egg. A chicken will keep taking 1 HP of you every time you refuse to give the egg back.
To your northeast is an aquasol. Then head back west and go east, circle around and after talking to the kid jump off the ledge. After you've crossed the bridge, circle to the level below to get another Aquasol. Before exiting the area, check a nearby tree and jump on it to get a spider.
When you reach Citan's house, go to the back door and jump behind the flowers to get Midori's ring (It won't show up on the item list, but you have it). Then go up the ladder and check one of the doors halfway to get an Aquasol (A chicken will come out of it). Then head to the telescope, jump to the small roof to your side and check the chimney for 120 G. Now go to the main entrance and talk to Yui and Midori (Yui will bake the bird egg for you). After that, head to the other house with a land crab, talk to Citan, then touch the music box.
After a dinner scene, Fei leaves. Save your game before the exit (Don't worry, there are no monsters now) and you'll reach Lahan. You'll watch some dramatic events and fight an easy battle against a gear, then you can leave the area and head to the Blackmoon Forest.