There's kind of no reason for the PCs to talk to the townspeople, but they are the only link to the adventure areas. I had to persuade the PCs to spend a little time getting to know everybody and their rumors and comings and goings. If they don't do that. then it's either teleport them to where they want to go through weak hooks "Hey, didja hear about the fairy mound?" or get them to walk around for weeks hoping to bump into things.
I think I was too nice with the Knight... the players didn't really earn it.
For a group used to hexcrawl sandboxes, it's all peachy, but if they just want a ride to Baleon Nakt it can be frustrating for them.
There's a certain room in Baleon Nakt that can be a challenge for some groups because of sheer numbers and low starting HP.
I ended up making a list of places and events in the module and who knows about them so if the PCs did end up talking to someone I didn't miss my chance to set the hook.