The ghost, now revealed to all and sundry, turns into a number of frightful shapes and chases the ponies and the kids out of Paradise Estate and into the woods. There, the ghost appears to somehow gets itself stuck in a tree, at which point it's no ghost at all, but a shapeshifting bird who introduces herself as Pluma and promptly traps everyone in nets.
Once the heroes are trussed up from the trees, Pluma engages in some expository monologuing to explain her actions. A very, very long time before the present day, all of Dream Valley was covered by water and ruled by a wicked sea monster named Squirk, who enforced his rule with a magical Flash Stone. Eventually, the waters receded for unknown reasons and left Dream Valley exposed except for a single river, in which Squirk remained. The plumas, Penna's people, arrived under the leadership of her grandfather and soon found themselves attacked by Squirk. Pluma's grandfather stole Squirk's Flash Stone and broke it in two, dropping one part in the deepest point of the river and the other in the highest area he could find — an area which, incidentally, would become the location of Paradise Estate.
Now, however, Squirk has managed to capture Pluma's grandfather and is holding him hostage, forcing her to work for him. Exposition done, Pluma apologizes for her actions, flies over to Paradise Estate, turns herself into a mirrored lens and begins to beam down light into Paradise Estate. The kids and the ponies, left behind, work frantically to free themselves, and manage to reach Pluma just in time to see Paradise Estate explode, leaving only a crater behind.
This episode contains examples of:
- Apologetic Attacker: Pluma apologizes profusely for her actions, even as she traps the main characters and destroys their house, as she regrets what she's doing but sees no way to avoid it.
- Disney Acid Sequence: The scene where the ghost chases the characters out of the house involves some very bizarre visuals, including a ghostly wall seizing a pony in its mouth, the specter taking on horrifying shapes as it chases the characters around, and a shot of moving, colorful shapes with no evident relation to anything else.
- Caught in a Snare: Once she's got the main characters in the forest, Pluma activates a trap to drop nets on them and then hoist them into the air with a large rock as a counterweight, leaving them dangling and helpless.
- Giant Spider: At the start of the episode, the ghost turns itself into (six-legged, vertebrate-faced) spider of giant size to scare the ponies.
- Info Dump: Pluma spends a good third of the episode's runtime expositing about the history of ancient Dream Valley, Squirk's rule, the pennas' arrival, and their history with the monster.
- "Scooby-Doo" Hoax: The ghost terrorizing the ponies turns out to be "merely" a shapeshifting, talking bird who needed them out of her way so she could take an artifact hidden beneath their house.
- Wheel o' Feet: When Pluma scares Sweet Stuff while pretending to be a ghost, the latter briefly gains two of these — one for her front legs and one for her back ones — while running in place before fleeing.
