interesting. i haven't messed at all with the goblin in any of the hotfixes so i wonder what went down. i'll take a look now, thank you for the bug report!
edit:
found out what the issue was. i messed up an if-else clause that made it so wand-only modifiers wouldn't be considered by the goblin, so this leads to a catastrophic crash when he makes an item with incorrect modifiers, and the game halts completely. luckily, this is only for wands and since the goblin is after the password checker, i'm in no hurry.
as long as you don't feed him any wands you'll be fine. thanks for the bug report, with your help i was able to easily solve this issue/
if something like this happens on ironman in the future, you can always force-close the game (altf4, task manager, etc) and your game save will remain. the game always autosaves at the start of a level to prevent crashes or such from fully destroying a run.