Rescuing Zandalor does not cut off any areas or prevent any quests from being complete.
If you don't have too much of a problem with clearing the Rivertown sewers, keep going and rescue Zandalor. Save before going through any doors, and you can always re-load if required. After rescuing Zandalor, something will happen and he will want to teleport you somewhere. Save, then let him do so; if the area is too tough, you can re-load. This is the 'no guts, no glory' play style. <img src="/ubbthreads/images/graemlins/biggrin.gif" alt="" />
As for as not having the teleporter stones, stick one or more of the chests in the sewer somewhere handy, and use them to dump loot into. When you get your teleporters back, you can return to get everything (flag your map with the location). I did this in Iona's dungeon, though I was returning later to finish it off anyway.
Actually, Iona's dungeon would be a good place to level up first, with the health and mana shrines scattered throughout.
Restoration potions can be much more effective than separate health and mana potions.