Whatever this place is, it's filled with some sort of toxic goop that takes HP when you step in it. But like in Mt. Gulg, the damage floors prevent random encounters.
Oh. We're inside Leviathan. Guess he was in the ship-swallowing business before he signed on as a summoned monster (since summoned monsters don't exist until the next game).
Also, that doorway looks a little... um...
There's a settlement inside. This entire scenario was copied for the Tanzer sidequest for SaGa Frontier...
Well, not really "stolen" since apparently much of the creative team was the same.
Ask about Ultima Tome: Where'd you hear about that!?
Ask about Mysidia: I've been to Mysidia. A town full of mages.
Ask about Dragoons: As a matter of fact... I am a dragoon. What? The dragoons and the wyverns have all been destroyed? That's absurd!
Ask about Wyverns: Wyverns? What about 'em? What's with you people?
Show him the Crystal Rod: So you guys were after the Ultima Tome, too, when you got swallowed up. Well, since we're looking for the same thing, we might as well team up. There's a boat up ahead, but there's also one tough monster standing in our way.
Is it a slime pool?
Dragoon: Who knows? Together, we might be able to take it down.
Apparently his name is unambiguously "Richard" in Japan, despite being translated as Ricard, Gareth, and Edward in various English releases.
This was before dragoons got their signature jumpy attack style (which shows up in the next game, like summon magic). Ricard is just a strong physical attacker with a fondness for spears. I say "strong", but he's way behind the other three, like every fourth character since Minwu has been.
Black Mask / White Mask -> Crystal Rod ->
Escape from Leviathan -> Mysidia Tower -> Ultima Tome
Old man: It looks like he swallows up anyone who has a crystal rod. See? I've got a crystal rod right here!
And here I thought mine was special. Did all of you jerkholes have to go get the masks and defeat your doppelgangers, too?