Altmiller Cave is an area that has been described as "Evil" by the guards in Tolbi, and it is a place that Babi often disappears to, for unknown reasons.
As you enter the cave, the first thing you will notice is that as you progress, it gradually gets darker. By the time you reach the end of the initial path at the door, the screen is pitch black except for a small circle near Isaac. Go through the door at the end of the path. In this small area, you will see Isaac's circle of visibility, as well as an area lit by a torch. You can also use Reveal to see your path. Head left, then north and down the stairs. In here is a treasure chest that is barely in the light's reach; it's actually a mimic, so kill or ignore it. If you kill it, you receive a Water of Life. Go left, then north, using Reveal as needed. As you head north, you'll see the outline of a figure laying on the ground. Talk to it. He will ask you to go get his mystic draught for him. As usual, Garet protests, though the other characters ignore him. When the cutscene ends, head for the door to the north. The invisible man will stop you once more, and then you are free to move.
In this room, head left, then north, following the path to the right towards a treasure chest. It contains a Vial. Grab it, then go back and head south. Upon reaching the south wall, move right along the wall. Finally, head north along the far right wall and then go through the door. It's no longer dark, but now you have a puzzle to complete.
As you walk north, and then up the stairs towards several pillars on the ground, you will see a Jupiter djinni. Roll the vertical pillar to the right, then walk around and push the horizontal pillar north. Cast Frost on the puddle, then walk around the south edge of the cliff. Push the vertical pillar left into the frozen one, then go back around to the other side of it. Walk up along the left side and push the horizontal pillar down into the Ice one. Now, go around once again to the right side, then north, and push the second horizontal pillar down. It will only move one space, but that's enough to allow you to reach and defeat Squall. Head back right, and then south. Push the log stump down and jump across, going down the stairs on this side.
It's dark once again in this room. Head left along the path to reach a treasure chest containing a Cookie. After getting it, go back to the right and then head south. Walk left along the south wall, and use Reveal to see the proper route amongst the rocks. Once you've navigated above the rocks, head left and go down another set of stairs. This area is lit once again, with the same pillars to roll around. Push the vertical one nearest you to the right, then move down and roll the horizontal one to the south. Climb the stairs, jump across, and walk to the right along the cliff against the southern wall. When you reach the right wall, head north and slide down the cliff as soon as you reach the north wall. Roll the vertical pillar to the left and enter through the door.
This is the room that the invisible man asked you to visit. Remember the combination he told you: Blue, green, white, yellow, red. As if they didn't say it enough times in the cutscene, you can also use Reveal to see the rocks' true colors. Turn the blue one first, then use trial and error to find the next one. Once you've gotten two right, a big wheel of colors will appear and spin. Which ever color it lands on, turn that rock next. Once you've done 5 colors, a door will appear in the wall. Inside is a treasure chest containing the mystic draught. To simplify things, you can use Retreat to skip back to the beginning of the dungeon, then walk down until you reach the man again. When you do get to him, just talk to him. He will take the draught and come into the light. As you talk to him, the guards of Tolbi will come.