There are so many places hidden away in this game. That's one of it's many splendors. I'm still finding quite involved and wonderful story encounters/areas after 4 playthroughs.
Yes, it's really not that hard to take on the goblin village, once you have disposed of the leaders and everyone is red. Just head for the high ground, and start picking the little goobers off as you grease the buggers. It was a long, but very enjoyable battle.