If I am correct (fingers crossed), that's the house that leads you to the expansion area in the full game. But honestly I do not recall, has been a long time since I play IWD without HOW.
As for the villagers, they started to leave after I talked to a little girl, try talking around...
I don't recall what others you need for the Hand mini quest, your list seems pretty complete to me.
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Long live H22A1!!!!!
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