Event Glitch?

During the Dragon festival I bought an extra character slot and made myself a shiny new Assassin, no big deal.

After completing the intro quests, I embarked upon the 'Dual Strike' primary quest and while there were no problems in finding & talking to Panaku to trigger the next part, I've found that he will only walk so far as the 2 palm trees near the shoreline, and to top it off, the target Tengu is nowhere to be found.

To counter this, I've tried abandoning the quest & restarting, char-switching, reloading and pretty much everything short of re-making the character. Has anyone else run into such a problem, and if so, what did you do to rectify it?

Do you have an event quest still active?

Yes, indeed I do. Is that causing the issue?

It probaly is.