Yes, you need the teleport spells (create portal and teleport, and preferably Call of Home as well) to prevent going through Dragonspire. But doing that you might earn enough Xp to get to 6th level moon, and get those spells quickly. And you haven't yet done the Colanth you say.
When you have the quest (3rd wizard guild quest) the Colanth will appear in the deep pool with the passage to the earth spirit.
Killing the Bandit King is the third quest for the town hall. I guess you'll not get that quest now, but then again the rewards are negligable. (If you haven't been back after disabling the bronze dragon it's logical you didn't get that 3rd quest.)
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