This is also known as the Palace of Durdel Anatha which Marketh has come to call his own and it is here that Marketh and the 5TH BADGE lay as well as the location of where you can find the FOOD that Tarnelm asked you to get when you went to Lower Dorn - Lower Mines.
First though, you will have to deal with the handful of thieves who are hiding in shadows through out the Palace as well as take care of those who are within each room on the bottom floor before you make your way upwards to face Marketh and retrieve the 5TH BADGE.
The first floor is very easy and there you will find Fleezum, Flozem, Ginafae and the Chef who resides in the kitchen and where you can acquire the FOOD, which is a sack of potatoes, for Tarnelm.
You don't have to kill Fleezum at all, for he is the one who drew the portrait of Marketh and if you confront him about it, he'll eventually decide to leave Marketh's Palace and pursue a different path of life. He will leave all his items on the ground for you as well.
Thanks to Susan for that information!
Pick your way through each room and take down the foul thieves within this complex and when thou art ready, head up those stairs like the champion and brave warrior that thou are and bring Marketh to his knees!
Dotted with hidden thieves, Marketh's Palace LVL 2 is a simple walk in the park as the only real threat is Marketh and his companion Seth, who is also hiding in one of the rooms waiting for the chance to strike. Marketh can be found in a room by himself and I suggest it best to walk through the complex and clear it out before you confront Marketh for there is a good chance that when you attack him, that all the hidden thieves will appear to assist him. This is just speculation and I'm not sure for I killed all the hiding thieves before I went to speak with Marketh.
The battle itself against Marketh was pretty straight forward and as soon as the dialog ended, I had my whack and bash team of four rush up to engage him, while my Thief shot arrows and my Mage weaved some spells. Before I knew it, he was dropped and I got nothing in terms of bleeding wounds or worry during this battle. That surprised me of course because I was expecting something much more elaborate would have taken place.
Although I took the path of blood and guts, you do not have to kill Marketh and doing this will gain you more experience over killing him, so if that's what you're looking for, perhaps keeping him alive would be better. Doing this will also make Ginafae unhappy and you will also be able to free her. To do this, bring the null-magic potion found in Malavon's Stronghold which will break her ties to the room and set her free.
Thanks to Alan and Travis for pointing this out!
I found Seth in the room next to where I found Marketh and he is sneaking around in the shadows and I would never have found him if I didn't double check the complex for he was in an odd place. When I first entered the room, I found nothing, but when I returned for a routine double check, he appeared and attacked me. Taking him down won't be a problem for anyone in the party, just watch out for the cursed item that will be found on him, although this item could have been random as well. Always identify items before you put them on.
Now on Marketh's corpse is the 5TH BADGE which you should obviously pick up and take with you, the most important item on his body upon his death.
Although Marketh's Keep was relatively small and could have been larger, there is still more on the way and the last badge that you'll need will be covered next.