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Battle companion
Dusty is invincible, and will follow you anywhere on the map. This means you can lead him around and have him fight for you. As long as you don't get killed by the enemies you lead to him he'll be the perfect bodyguard. Of course if you go somewhere where he can get stuck and you can't lead him out again you can't finish this quest!

When you approach Baal Tondral he will talk about how your heart yearns for the truth and freedom from the lies of the ore barons (etc. etc. etc.). When he's finished preaching ask him if you can talk to him, and then ask him about loyalty. He asks you to find a new initiate.

To do this, head back near the entrance and find Melvin. He's a digger, so should be easy to spot. Talk to him until he mentions his friend, Dusty. Head on back to the Old Camp and convince Dusty to join you, netting you 250 EXP. Since he's leaving you might as well help him clean out his hut! The combination to his chest is R L L L and it contains 34 Ore, 3 Coins and 1 Razor. Once Dusty is gone you can use his hut as your own whenever you're in the Old Camp.

Dusty explains that he can't leave the camp because the guards know he wants to, but he might be able to if they were bribed. He says only those at the south gate can be bribed. Head there. Say you're out for a stroll. With your 100 Ore in his pocket, the guard will suffer from a brief memory lapse, leaving you with 250 EXP and the freedom to head to the Sect Camp.

If you wish to keep your 100 ore over the 250 exp just tell the guard its none of his business, run by him, and either keep running or lead him far away so noone sees and *kill him for extra rewards(*unconfirmed if he is invincible). He will forget the entire thing ever happened besides the usual "are you back for more trouble again" phrase when you talk to him.

Lead Dusty back to the Sect Camp and dump him in front of Baal Tondral, who will be impressed and award you with 500 EXP.