Odd....I just kill Tranzig flat out. I didn't listen when Mulahey asked me to spare his life, nor when Tranzig asked the same thing. Didn't really occur to me to do it any other way. No mercy for the bad guys! I just talk to Tranzig, listen to his arrogant spiel, hit him a few times, say "Die you pompous fool!" and whack him. My map gets updated. If that's not the way it happens in your game, I suggest you go talk to Elminster, who happens to be breezing through town and can be found outside Taerom Fuirin's smithy. He tells you that "The bandits make a habit of traveling in the northeast," though I don't think he updates your map for you. If neither of those work, here's how to get to the Bandit Camp:
SPOILER-ISH STUFF AHEAD
Go to the Friendly Arm, and go 1 map square east. It's either Peldvale or the Larswood, I forget which is which. BE CAREFUL! Lots of tough enemies with ranged attacks. There's a bandit here who comes up and talks to you. Try to join up with his band (This is the approved, sneaky, undercover way of getting to the camp). If you say the right things, he'll take you to the camp to meet his boss. If not, he'll attack you. Big whoop. **Remember what you told him.** You can still be sneaky, though: Go 1 map square south, and there's another bandit who does the exact same thing. Make sure you don't tell him what you told the first one. This guy is a bit more lenient, though, so you've only got a 1-in-4 chance of screwing up here, or something like that. Congratulations, you're in. Now you get to meet the boss of the bandits.
Maybe you messed up on both interviews, or maybe you just want to charge into the bandit camp with fire and sword. Easy. It's right northeast of the Friendly Arm. Everyone will be hostile to you, though, and boss won't be there, which is why this method isn't suggested, because boss carries some good equipment.
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