And months later:
I wanted to add this as I had the same problem. It was my habit not to run all the way down that road as the Hero Tiberius was blocking from my initial questing in the area and not to be confronted. So I never got down that road to see the entrance to the mines. Had to come here to find a clue.
Now I'm level 11 and Tiberius is safely put to rest, giving me free reign of running up and down that road now. In fact I could have carefully dodged Tiberius from Level 1
Hopefully this will help a new player to NOT make the same mistake. I wasted a couple of hours looking around the Freedom Islands again (that's where the Dwarves are right?) before resorting to the forum here.
Find some way to dodge the Impossible stacks and explore everywhere.
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