1) You have to go THROUGH the Boogre caves...once inside, you'll find a room with a lot of holes in it and two exits. The north exit from that room leads to the new area, where you'll find Doshi Gin and the magic lamp.
2) They can be used as weapons. The curses drain some HP from you, but you recover them almost immediately, so if you want a stave-user to use them, go on and equip them. BTW, any character with the Artifact of Spirit spell and some blessing skill can add "Regen" to a ring and counteract the HP drain.
Unfortunately, few good staves in the game are immune to the curse. The most notable non-cursed stave is the Staff of Death (you get much later) or the Staff of Wails (again, later, after Brimloch Roon).
3) That's Jathil. He's required for the 3rd Priest Guild quest in Ishad N'ha. You also get a neat trait from him when you help him out.
Cheers,
-Sazerac