From what I recall you have to go to the inner graveyard to the left, then down into the caverns then down another screen then I or 2 screens off to the right. You get to it from the screen where you encounter the horny kobold girl and the grumpy goblin (put that ring on before you talk to her, the one that negates healing). You'll probably run into the cat boy and the moth at least 3 times before you get there, though.