I had trouble finding the elf. Gregor told me the elf was being kept in a community house "south" and "first house on the left". I found him in a house on the right after leaving Gregor's, but only after I had gone through every building on the left about 10 times each! After talking to Gregor, then finding the elf, you know which direction to look for a suspect. <img src="/ubbthreads/images/graemlins/winkwink.gif" alt="" />
I'm guessing he means your character's left. <img src="/ubbthreads/images/graemlins/smile.gif" alt="" /> Though it's good to see an RPG not breaking the fourth wall for a change. (Memories of PSOne games where medieval characters tell you to press ×,o,<,<,×.)