the embrace the shadow room, you have to walk onto the shadow (and get hurt by the trap), then the door will open, then bounce lightning into the room to open the adjoining room up...
as for the battlesquare, to get the good items you must win a difficulty setting by completing 3 consecutive squares, then 4 and so on up till 7 (a total of 25 battles per difficulty level)
but finishing the battlesquare was challenging, but not entirely impossible... just requires lots of reloads
