It took awhile, but I finally dug out my old saves, found one just after meeting the old man and took a detour to the Dark Forest to kill Boratus before heading for the disappearing gem.
The building is the NPC storage room, and includes dead NPCs, some who you have not meet yet and those who are no longer needed (such as Seth after completing the escort for the healers quest).
When the cut scene conversation starts, Boratus is missing. When the screen focus switches to him, rather than move over a fraction of a screen width, it switches to
the NPC storage room (47KB screenshot). This room is described a little more in the
Reviving dead NPCs topic.
I found a similar glitch when I was checking an old save for something else, involving Mardaneus. minor spoiler: [color:"#3A495A"]After you have recruited him to the council of seven, if you close the door to his house it re-sets his position and triggers him to yell for help, claiming he has been locked in. I was still able to complete the blessing ceremony, with the screen focus switching to his house, though a couple other people tried this and the game crashed on them.[/color] (highlight the text to read)
