Crescent Lake

When you enter town, head to the upper-right of it. There will be a path to the 12 sages, talk to them all and they'll give you the canoe. Talk to Lukin and he'll talk about some stuff that really is not important. Now, train your ass off to about level 15+.

Now, make your way to the cave where Kary, the fire fiend, resides. But, to get here you need to get through the water maze. Here are instructions:

1. At the first breakage, take a left.
2. At the next one go up.
3. Next one, take a right.
4. Then take a left at the next one.
5. Take another left and go around.