To be honest, this was the most uninteresting scenario presented by the book to me in the way it should be played, so let me described how I altered it:
The start was probably the best part of the whole thing: The crippled PC awakes at the shore of the red lake with no memories and a young, dead boy next to him.
The village is currently celebrating the summer solstice with inviting all people from the neighbouring villages, praying for a mild winter. It used to be a huuuuge demorthen thing, with giant bonfires and animal sacrifices in the woods to calm the spirits, but since Dearg is equally split in the religion of the One God and the traditions of the Demorthen, the village at whole became more lazy and only likes celebrating with good food, music and booze. So my group knew each other and the other guys where to find the missing person (which was Eoghan, the son of the chief!).
They found him at the shore and could identify footprints of 2 other people, probably at the same age as the dead boy (one belongs to a guy, one to a girl - Alban & Maella), plus some prints of wolves or dogs. Eventually they lost track of the prints and this clue ended here.
Back at the village Eoghan was accused of killing the boy and sentenced to death, but was also granted 3 days to prove his innocence. The group was ordered to watch, guard and help him. If they would flee, all of them were branded as traitors to the Kingdom of Taol-Kaer. Loeg managed to heal Eoghans wounds considerably, with his Demorthen "magic". He was not without injuries but you could see some wounds closing before the eyes of the PCs (the idea behind was to show them the power of a demorthen, enforcing them to convince the village to follow the old traditions again - which our Morr player really did).
The investigation started by interrogating some NPCs in the village: first, the brother of the dead boy, who gave the lead to his brothers friends, Alban and Maella. Both were not seen this day, which is not unusuall for Alban, because he tends to go to the mines for several days, but it is for Maella. Searching the rooms of both revealed two things:
In Maellas room they found a love letter, written by Eoghan, confessing his love to Maella (which is a fake and was written by Alban), plus a rare herb called Jesters Kiss, usually only found in the academy of Reizh. Combined with strong alcohol, the leaves of Jesters Kiss produce some sort of a love potion and surprise surprise, the alcohol was found in Albans room (Alban got the herb from the hag in the village and used the potion on Eoghan to make him a victim for his ritual - but since he fought back, when the 3 plus the dogs attacked him, Alban fled with Maella and now intends to sacrifice her instead).
It was getting late and the investigation was disturbed by a commotion in the village: people were screaming and shouting "Feondas!". To summarize this shortly, a Cnaigh attack, coming from the warehouse assaulted the village and let to huge casualties: the bite of these cnaighs is highly infectious and the infected usually die a few days later. Among the infected were about half of the village guards, the chief himself and a sister of one of the PCs (playing the Bard). However by amputating the infected body part, the person would usually live on (though crippled, considering the medical standard of this setting). In the case of the chief it was however his sword arm and in case of the travelling bard, her left leg - both would never again be able to perform their old job/role. After a very emotional scene, with Eoghan crying at the bed of his sleeping father and the Bard PC talking to her mother about her crippled sister (who neglected both, which led to their lifes as traveling bards in the first place) Eoghan had to take over his fathers role as a chief, while still investigating his own charges. The warehouse revealed the Cnaighs burrowed into it from outside the village, right next to the fence, near the forest. Also some notes from Alban were found inside.
On the next day, together with 2 hunters, the group followed the Cnaigh trail into the woods and found some strange wodden totems on the way (I'll explain these in a moment). On a clearing of what looked like to be a swamp they found a huge burrow and something very interesting in its entrance: clothes and weapons! Somebody (Alban) put the clothes of all members of the villages small council (including the chief, the demorthen, albans own father, the damathair and the oldest hunter) here, to give the Cnaighs the smell to track and assault them in the village. Luckily only 1 (the chief) of the targets really got injured. While they were investigating the burrow (which still hosted a lot of Cnaighs underneath!) the clearing was flocked by ravens, all staring at the PCs. Shortly after, a roar emerged from the woods, like the sound of a warhorn. Next a giant wodden Feond with an animal skull and bright glowing blue eyes (something like the Leshen from Witcher 3) stepped into the clearing and all of the ravens started to attack the PCs. They fled into the woods, nobody even dared to charge at the Feond and after they passed again the strange totems (which mark the territory of the Feond) they allowed themselves to rest. A trauma roll was forced upon them and everybody failed it (so sad...) and all of the PCs mental disorders increased by 1 degree and kicked in. It was fun.
Back at the village the small council was alarmed by the dire news the PCs brought with them and wanted to hire the Hilderin Knights, resting in Kaer Moiral at the mountain pass towards the border of Gwirde (as the village had nearly no healthy guards left to deal with this). The group rejected this, but they were overruled, since only Eoghan had a voice in this vote. So a messenger was sent to the knights, asking for help.
During the evening the PCs bothered for the first time with Albans notes, they found inside the warehouse and with some NPCs help they got a hint of a hidden smugglers cave in the far eastern woods. On the next morning they set out, now mounted, towards the eastern woods. After a long search they found the entrance to a cave:
A very small maze let to two big rooms of what looked like an old smuggler hideout. It was guarded by dogs. However, at the same time the scream of a girl was heared and the dogs shrieked and fled the cave. In the other room, Alban was standing with a dagger, a kris, covered in Maellas blood, whos mutilated body was tied to a huge altar. In his other hand he held a yellow crystal (fossil flux) and on the altar, next to Maella was a strange book, laying there open. Alban was somehow talking to a ghost or something (he was mumbling in a different language nobody understood), but nothing further happened, besides he fled when the PCs found him. Our Ionnthén Morn stayed and tried to identifiy the strange presence he felt and even got a vision of this ancient Feond from the Aegwynn, which was released by the ritual from the book, but nothing else happened here.
The real deal started outside the cave: Rain was pouring down like a cascade, accompanied by lightning and thunder. At the same time, the earth itself seemed to become alive! Huge giants emerged from the earth, two, three, half a dozen, a dozen, over a dozen! All over 10 foot tall, they joined each other in a silent walk strait to the village. Alban fled from the PCs and tried to hide betwixt the giants, only to meet his end as he stumbled in the mud and was crushed by one of the giants. The PCs hurried back to the village to warn them about this coming Feond attack, however there was a big commotion going on when they arrived.
The Hilderin Knights managed to slay the Leshen-like Feond (they brought its head as proof) and demanded the build of a small chapel inside the village, so the villagers worshipping the One God don't have to travel to the outside monastery anymore. A discussion was already in progress, when they PCs joined and they decided to hide the fact of the Feonds before the Knights. Morn was searching for Loeg, the demorthen, who seemed to barricaded himself in his own house. Morn broke in and found Loeg sitting within a circle, surrounded by a twirl of smoke, with his open eyes rolled back into his head and a broken stone (a rune talisman with an ancient word for Feond written on it) inside his hands, mumbling strange words in a language unkown to Morn (though the sounded similar to the words Alban mumbled earlier, before Maella was sacrificed). Morn broke Loegs trance and the old demorthen explained to him, that he would rather see his villaged burned that converted to a wrong religion. So HE summoned the Feondas to attack the village (Albans ritual was indeed just coincidence).
Outside, the small council agreed to the knights demands, however the tone was getting more tense by the minute. Then one PCs couldn't bear it anymore and told all of the village about the upcoming Feond attack, which resulted in the knights immediate withdrawal from the village, as they sensed a trap. Villagers were begging the knights to stay, others were shouting at them, insulting them as cowards and so on. Arven, another PC overdid it and the knight commander threatened the village one last time, if they would not let them pass, the knights will slaugther the entire village. And Arven could not shut her mouth...
So the slaugther of Dearg happened, resulting in a killing of most of the men while some brave heroes (including one or two PCs) organizied the escape for women and children. Later, history would tell that a huge Feond attack was assaulting Dearg and that the Hilderin knights came to the villages rescue. Now Dearg belongs to the Kingdom of Gwidre, abandoned by Taol-Kaer and under steady protection of the Hilderin knights.
The end.
It took me 2 sessions to run this and my group found this to be the best of the 3-part campaign of Loch Varn as it had much more social interactions than the previous (though I didn't mention it here, I really focused on the celebration and later on the tragedy by the Cnaighs, which was really emotionall to the players, having to witness the crippeling of a father or a sister, knowing that they will never return to their old lives)
A short criticism to the original oneshot: To me it was just boring to follow a Q&A trail over 5 NSCs towards the end, so I added these different aspects to the plot, to make the village more interesting and alive. I played the campaign in order 1-2-3 with red falls as the final chapter, so the death of all PCs was more or less calculated. The first chapter, Loch Varn was one of the best oneshots I've ever read, the idea and the techniques are very cool and unique so I altered not much in this. For the second one, Poison, I only extendted the village of Melwan a bit and exchanged the lizards at the end with the mind-controlling Feond described in book 2 I guess.
I hope you enjoyed the reading.
P.S.: Sorry for the abbreviation on some of the names, I can't recall all of them on the fly and probably misspronounce names like Ansailier, so I used general terms. Hope you can forgive me on that.