A Familiar Face
Town of Baron
After exiting the Devil's Road, walk through the door to emerge into the town of Baron. Villagers talk of the rowdy soldiers that have taken over the pub. Before you take care of that, however, make a short detour out of town and head east and north, returning to the town of Mist.
The only building that seemed to survive the Bomb attack from the beginning of the game is the house north of the Inn: Rydia's house. Walk into the fireplace, and east, to find three chests, with Gold Hairpin, Clothing and Ruby Ring. Step east to enter another hidden passage, and work your way south to a single chest with a Polymorph Rod. In the 3D versions of the game, the MP +50% augment can be found near the fireplace.
There is a Bomb Fragment hidden in the grass to the east of the pond outside Rydia's house. From the well outside the armor shop, head east through a secret passage to a little grassy clearing. There are two more Bomb Fragments hidden in the grass here.
If you have copious bag space and money, it may be a good idea to pick up the items from the weapon and armor shops. The Inn here is quite cheap as well - a paltry 50 gil - so stay the night, before heading back to the town of Baron to continue on your quest.
Town of Baron, Revisited
With Mist looted of its goodies, head to the Inn and then walk into the north room to bust up the Baron baddies. When the party enters the pub, who else do they find but Yang, sharing a table with the Baron soldiers! Cecil approaches Yang, but upon recognizing Cecil, he orders his companions to attack the party.
The soldiers are no huge pushovers, due to countering physical attacks with Mini, and magical attacks with Pig. However, anyone you equipped with the Ruby Ring gains resistance to the Pig status. All you should need to worry about is casting Esuna or Mini on any party members afflicted with Mini. You can also use the Polymorph Rod you got earlier to turn them into Pigs too, which negates their ability to retaliate with Mini when attacked. However, a single -ara spell should be enough to take them out.
After you defeat the soldiers, Yang will step in to finish the job himself. Just keep attacking him and keep your party healed. Even if you got a bit roughed up by the soldiers before, Yang shouldn't be too difficult to beat.
Once Yang is defeated, the mind control that Golbez had placed on him is released. As the party is planning their raid, Yang realizes he literally holds the key to a silent infiltration of the castle: the Baron Key, which can unlock the Ancient Waterway. Now that the party is also back in the area, you can return to Mist to, well, loot the smoldering remains.
The Baron Key
Yang's key unlocks more than just the Ancient Waterway: it also unlocks the weapon and armor shop that was locked last time the party was in Baron. Despite being locked, the store is staffed, and you can buy anything that might be good for your party.
After you've made all your purchases, head down to the southeast corner of the weapon and armor shop. If you continue south of the stool in the corner, you'll enter a secret passage. Follow the passage around the east side of the room, and behind the counter of the shop. The two chests contain Zeus's Wrath and 2000 Gil.
The Ancient Waterway
The entrance to the Ancient Waterway is on the far west side of the town of Baron, through a door in the wall. When prompted to use an item on the door, select the Baron Key. Before you head down the stairs, go through the middle tile in the east wall and grab the chest with 1000 Gil.
In the first area, follow the path south over a bridge, and continue south at the intersection. There are three chests, holding Hi-Potion, Ether, and Zeus's Wrath. Head back to the north, east at the intersection, and then north. Cross the three bridges, follow the path around to the east, then cross three more bridges. Take the stairs to the next area.
In the second area, take the stairs down into the water, and walk all the way to the south. Follow the secret passage into the next room, and take the Bronze Hourglass from the chest. Go south in this room again, and follow the secret passage to another room with another chest at the top of the stairs, this time with Spider Silk. Go back the way you came until you're in the first room of this area. Head east through a secret passage, then through another secret passage in the east wall in the next room. There is a chest in the middle of an island in this room, with Hermes Sandals.
Four rocks on the east side of this room point to a secret passage. Head through it, then climb the stairs to the next area.
The third area is fairly linear: simply follow the path, and take the stairs up. Before you head to the next floor, go west for a chest with Ether. Then, continue on to the next floor.
The fourth floor has a save point through the door to the west. Save your game, but hang on to your Tent unless you're in dire straits - a free heal is just around the corner. An Ancient Sword is hidden in the top of the right wall of the room. Exit the safe room and take the stairs in the eastern part of the room to officially start the invasion on Baron Castle.
The party emerges from the Ancient Waterway into the moat of Baron castle. Follow the moat around to the west, and enter the castle courtyard through the arch. If you chose not to use a Tent in the Ancient Waterway, head for Cecil's room in the rounded tower in the northwestern part of the castle, and sleep in the bed.
After healing up, exit Cecil's tower, and go south, then into the door in the southeast. Take the stairs up to come out on a rampart, and take the stairs across the way back down to enter the castle.
Baigan approaches the party, seemingly eager to assist Cecil in his fight against Golbez. The twins, however, sense Baigan's evil intent and warn Cecil. His true nature revealed, Baigan attacks!
Baigan's two arms can attack independently, and regenerate after being defeated. The arms can cast Paralyze and Drain. Baigan's main body should be focused down since the arms regenerate too quickly to be worth too much effort. The arms are fortunately susceptible to Slow, so you can at least reduce the amount of spells hitting the party.
Attacking Baigan with a spell causes a reactionary cast of Reflect. To get around this, have Tellah cast Reflect on your party to put up your own reflective barrier, then cast magic on the protected party member. The magic will bounce off the party member's shield and hit Baigan. Palom and Porom's Twincast can be effective here, since Comet goes through Reflect. However, Pyroblast does not, so weigh the risk before casting.
Keep the party healed up, because Baigan's arms each explode after the body is defeated. You may have a short window to cast a big heal after one Self Destructs.
After you defeat Baigan, you can backtrack to the Ancient Waterway to save if you'd like, or simply heal up in the bed in Cecil's tower. You can also take this opportunity to grab some extra loot that wasn't accessible at the beginning of the game.
Looting Baron Castle
From where you fought Baigan, continue east and up a set of stairs. Continue east to another set of stairs back down. In the next room, there is a hidden switch on the wall to the west of the torch, which opens the treasure room. There are six chests, holding two Ether, two Unicorn Horn and two Phoenix Down. Return to the room with the hidden switch, then continue south to come out on the eastern castle courtyard. Head north, under the gate, and enter the tower.
In the tower are four chests, with two Hermes Sandals and two Bacchus's Wine. The second chest is a bit tricky to grab; take the stairs down, then back up, and orient yourself north to open the chest. Take the stairs to the second floor on the east side of the room, and open the chests for two Hi-Potion. Go up to the third floor, and open the three chests for two Tent and one Ether. There is a second Ether hidden in the pot to the east. Head back down the stairs to the first floor.
Take the stairs down and check the second pot from the left for an Elixir. There's nothing else to the east for now, but you can return after the next boss.
Once you're ready to progress the story, take a minute to check everyone's equipment. Equip one Ice Claw and one Lightning Claw, if you have them, to Yang. Then, head back into the castle, and continue north into the throne room. The King welcomes Cecil back to Baron, but quickly reveals his true identity: the Fiend of Water, Cagnazzo!
Since Cagnazzo is weak to Ice, and you have two very powerful Black magic users in your party, this fight should be a cinch. Have Tellah and Palom cast the strongest Ice spells they know. Porom can cast Protect on the party to shield them from the few hits Cagnazzo will dish out. Yang's claws should be hitting Cagnazzo fairly hard each turn, if you equipped them.
When Cagnazzo puts up a wall of water, you can dispel the wall by casting a Thunder spell. However, if for some reason you do not dispel the water, he casts a heavily damaging Tsunami on your party.
Once Cagnazzo's health is low, he retreats into his shell for more defense. He will also cure himself in this state. You can wait for him to come back out of his shell, but he really should go down fairly quickly at this point despite the high defense, unless your mages ran out of mana.
After you defeat Cagnazzo, Cid rushes into room and curses Cagnazzo for locking him up. The party introduces themselves to Cid, and he takes the party to the place where he hid his airship to help them on their quest.
When the party follows Cid out of the throne room, Cagnazzo returns with a venegance, and causes the walls to close in. Palom and Porom turn themselves to stone to save the party. Despite Tellah's best Esuna, nothing turns them back. The party reluctantly leave the twins, grateful for their sacrifice.
Meanwhile, Golbez admits that the Earth Crystal is proving difficult to obtain. Kain suggests having Cecil to retrieve the Earth Crystal, with the false promise of exchanging Rosa for the crystal. Golbez agrees to the plan and sends Kain to intercept Cecil.
Back at Baron castle, Cid takes the party through a hidden passage that not even Cecil knew about. The airship surfaces near the town of Baron, and Kain's airship quickly approaches, white flag drawn. Kain conveys the terms of the deal, and Cecil accepts, wishing to save Rosa, even at the cost of the final Crystal.