"Are we straight-up dead already?"
This is why you always SAVE YOUR GAME BEFORE POPPING THE GOODY HUTS! Purists might consider this a cheat, but I don't see why.
This is also why you try to get mercenaries or useful tech from your first couple of goody huts if you can possibly do it before founding a city. That way the mercenary can protect the city until you can build your own units, or if it's a safe area the mercenary can get busy exploring. The key to ToT in the early part of the game is to get as much tech as fast as possible, preferably stuff that will let you explore as fast as possible. Some units in this game are invisible, and you need to discover the tech to build the units that can best defend against them.
Jack-o-Lanterns are extremely useful. They travel 3 tiles/turn, and are best used to explore. They're not useful for fighting, at least in the normal Fantasy game. They can teleport from the surface world to the underwater world.
So why is he frittering around? Build a skald and bribe the Jack-o-Lantern!
"I don't know how you befriend things in this game."
Bribery, how else? If he had a skald, he could bribe the Jack-o-Lanterns, and (assuming he has enough money) he could also bribe a Fairy. Fairies function similar to skalds in that they can also be used for bribing other units. Fairies are also very useful in that they can teleport naturally among the different vertical map levels. They also travel 3 tiles/turn, no matter the terrain. And he'd better build sorcerers as soon as possible, since that's the best way to defend against the invisible units. Oh, and save up gold to bribe the Dwarfs and Frost Giants (that's what that quest is about - give a Frost Giant 400 gold, and they'll serve you as fighters).
@Dadais: Using a blanket for a cape is normal SCA practice until you can make yourself (or have made) a proper cape.
The Buteo are BIRDS. They are not "angels." They live on the clouds, and here's a tip that this guy is probably going to learn the hard way: Concentrate on building on Magic Clouds. You get tons of shields, and they're immune to disappearing if this game's equivalent of the global warming catastrophe happens.
He's going about this exploration completely the wrong way. Use the fastest unit that's capable of defending itself, ideally a Crag Wolf (which he just called a "dog")... or since he actually does have the ability to build a skald, he should have been using that to explore since skalds have a chance to bribe a barbarian or enemy and gain a useful mercenary or two.
Good grief... this is so frustrating not to be able to talk to this guy! Build a skald and BRIBE A JACK-O-LANTERN. He's got enough money, and he should have let his warrior rest to get his strength back up. And he should totally build the Round Table, since Summon Ice Drake isn't something needed for a good long while.
Bad diplomacy. Always try for a treaty so you can tell what the enemy is researching and what tech they have, especially as Goblins have tech the Elves can't research. Then you can contact them and propose a trade or demand tribute (or both).
(I'm going to stop for now - more snide comments to come later!)