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The Kobold Caves are involved in one of The Stan's quests. You won't be able to enter the area unless you've accepted the quest.
1 - Snivel
When you enter the caves, a kobold named Snivel will run up to you. It seems he and his kobold friends are fans of Winnie the Pooh, so if you have honey
with you and agree to give it up, then they'll let you move around the caves freely (and you'll also gain 250 experience). You can get honey
from the hermit who lives next to the Empty Battlefield.
If you don't have honey
, or if you're just feeling violent, then you'll have to fight Snivel and the other kobolds.
2 - Sack of Grain
You'll find grain
inside the sack. You'll need to use the grain
to lure the cows (#5) out of the caves.
3 - Kobold Chief
Near the chief you should find a chest with journal, 422 gold and a psionic gem
inside. The gem will allow you to talk to the Masked Man briefly.
4 - Chickens
The chickens might eat the grain you drop, and they're worth experience, so you might as well kill them.
5 - Cows
These are the cows you'll need to rescue. To get them out of the caves, create a "path" of grain using the grain
from #2. That is, move a short distance from the cows, use the special property of the grain
(either on itself or some other object), wait for the cows to move to you, and then repeat. If the cows start milling around and ignoring you, click on one to get them interested in the grain again.
You won't get any update in your quest log once you've completed the quest, so don't worry when you don't see it. Also, it appears that you'll only need to get one cow out to complete the quest, so don't worry if some turn around and walk away after the first one has escaped.
A. Exit to the Emerald Hills.