The appearance and uses of the castle are different depending on if you have finished the First chapter of the Main Story.
Before the climatic end of the first chapter, the castle offers few things to do. When you enter for the first time, you will see a small cutscene about how the undead forces enter the castle.
First off, you will come in, and you will see Artix, the Paladin, standing near the stairs. Talk to him to begin two "storyline quests." The first one involves talking to the various Knights of the Pactagonal Table throughout the castle. The second involves defeating a certain number of undead enemies.
Then you can proceed to the throne room in which you will talk to the King. You will then witness a cutscene in which Sepulchure makes his appearance. He then engages King Alteon. After that cutscene, you will get to choose if your character will fight for the side of Evil, or Good.
After your decision, (choose carefully) a new character, Drakath, who bears the power of Chaos, comes in and halts the battle. He then destroys Selpulchure, which causes a great explosion which is witnessed by his daughter, Gravelyn. Drakath then hurls a ball of chaos the flying lair of Shadowfall, causing it to fall to the ground. Drakath then announces that Chaos will now rule, and the War of Good and Evil was over, causing Good and Evil to form a temporary truce.
After Chapter 1
You may now access the Pactagonal shop and the Goods shop by talking to the knight by the stairs, if you are good. Also in the throne room, you can talk to King Alteon, and here you will find the tax collector if you are good, and are performing the second task for Gravelyn.