Let the Mystery Be
FFL2 gets better with the "some monsters are people" and also "some people are monsters" with enemies that are explicitly humans and never drop meat.I do like how unintentionally weird this game gets because of the technical limitations; there’s only so many sprites for the map so you see a lot of monsters in towns like it’s no big deal. Even the final boss is hanging around towns (that part might be intentional).
And the lack of space for text makes your party look like a wandering group of psychopaths who just kill people with basically no thought whatsoever
Silk Hat hanging around in towns giving hints is 100% intentional and actually foreshadowing the ending.