It's been half a year since the Successor, mad with power, demolished the entire Chapel and the hundred acres surrounding it. With the Prince of Certain Country, “Nightmare”, slain, the Hero of Ohiotown, Michael, missing, and Peklo of the Finnish Void slammed into Hell, things look desperate. Peklo has been exploring the labyrinthine caverns of Hell, plagued not only by demons but ghastly hallucinations of Nightmare and his own sense of being dishonored. Peklo is even still distraught by Successor's betrayal and refuses to believe it was his doing, but rather the act of an extremely malicious being, like the Drummer.
Peklo has already entered the first circle of Hell, the closest layer to the earthly realm. Surprisingly, Peklo has found Hell to be a dull challenge, but it has been draining his energy. Even Peklo's endurance is not enough to withstand six months of constant physical and mental torture as weak as they may seem. Nevertheless, Peklo's presence has actually frozen parts of Hell over.
As Peklo attempts to break through the wall separating death and life, Satan appears, incredibly aggravated by his numerous defeats at the hand of Peklo. While Peklo is still in a weak mental state, his strength is so godly that not even Satan's illusions can deride the force of Peklo punching Satan in the face.
In the middle of plummeting Satan, Peklo sees another vision of Nightmare and is swept by profound grief, Satan tries to use this diversion to utilize his ultimate attack, 666 Crams of Devilish Deliciousness, but the illusion of Nightmare appears to reflect the attack, sending Satan straight down to the lowest level of Hell. In this one instant, Peklo realizes there is something more to this hallucination of Nightmare, something beyond the wicked machinations of Satan…
Peklo has broken through Hell and is in the cavernous dungeon that lies beneath Castle Coxenburg. But the incredible exhaustion, especially with the idea of Nightmare acting as a strange guardian angel, causes him to pass out.
A few patrolling goblins lob around the fallen warrior, one being Sumac, though he is not yet identified. Sumac cackles to himself as they carry Peklo away.
Peklo wakes up in the cell. With his energy restored, he easily dispatches the goblin guarding his cell. After mingling with more goblins, freeing prisoners and etc, he bumps into Sumac. Somehow Sumac is able to overwhelm Peklo (Peklo was merely surprised by the amount of power Sumac had, and didn't utilize his full powers) with a trinket that carries the “Darkness”. As Peklo travels through the dungeon more, he realizes that these are the remnants of Castle Coxenburg, whose inhabitants have mysteriously all turned into goblins.
Peklo bumps into Sumac at the exit, and successfully defeats. He berates the goblin for abandoning the Chapel, but Sumac laughs, saying that the Chapel abandoned itself. He lets out a last breath and his body crumbles into a dark dust. Peklo notices the dust shares his own aroma and is even more befuddled. Along the way, Peklo notices various writings from Lord George, the owner of the castle. They mention that the entire castle's population turning into goblins after some experiments with the Darkness and Drummer Fragments went horribly wrong.
Peklo breaks into the castle's library from the dungeon, largely abandoned because its mood is far too intellectual for goblins. Peklo saves Thernz and Nagumo from a pair of goblins who also crumble into dark dust. Thernz and Nagumo mention they were looking for a book to help search for Diplo. Thernz is surprised at Peklo's appearance, and questions Peklo immediately about his recent doings, believing the goblins' new-found strength to be linked to Peklo. Upon realizing Peklo was in Hell in six months, Thernz is able to figure it out.
The moment Nightmare died, Peklo let out such a horrible scream, and that the immense Grim that inhabited his body began to seep out, polluting the very land Peklo steps on. A few months of exposure was enough to turn the human cesspit that was the Castle of Coxenburg, already a ground involved in the Darkness, a corrupted, lamer form of Grim, into a goblin haven, and with Peklo's arrival into the earthly realm, his Grimness was able to become saturated in the dungeon at a faster pace.
Peklo, Thernz, and Nagumo escape the dungeon. It is optional to explore more of the castle, and defeat the goblinized Lord George. Later in the game, Peklo returns to Castle Coxenburg to defeat the evil spirit Lord George used to experiment on the Darkness, an entity called COX, the original owner of the castle until he was killed, with his throne being usurped by the imposter Baron Katala of the Hardcar, the father of Lord George. The reason Coxenburg was such a place of filth was because of the negativity that stemmed from COX's lingering hatred, eventually polluting the minds of Coxenburg's inhabitants, and becoming the perfect catalyst to merge with Peklo's Grim, and goblinize the entire castle populaton.
The party decides to rest at the nearest town, though there is some trouble because most of the countryside around the Castle and the Chapel has become polluted by Grim. They manage to find a town at the fringe of the Grim, Armstrong Cannon Town.
At the Armstrong inn, Peklo tells Thernz that he's been seeing Nightmare everywhere, but Thernz disputes it, saying Nightmare's body parts became scattered after the Successor Slam. Thernz mentions that with the body becoming separated at such an amazing speed, the po, the lingering part of the soul that usually becomes the ghosts of myth, would not be able to withstand it, and dissipate. Peklo then tells Thernz about Nightmare reflecting Satan's attack. Thernz is intrigued.
Thernz has no idea what this apparition of Nightmare could be, so the two begin to suspect that it's related to Slam.
The two realize that they should start searching for clues about Nightmare's appearance, and what better person to seek than Diplo, the legendary scholar of Slam. They decide to sleep after, planning to go to Juts' Farm tomorrow for clues.
But they are interrupted by horrible screams. They emerge from the inn to see half of Armstrong Cannon Town destroyed. A large number of strange sculptures dot the town: doors within doors. Only then does Thernz realize that beneath Armstrong Cannon Town laid the McDoogle brothers, terrible beings infected with the Dark Mals. Peklo's seeping Grim must have awakened them from the dead.
The party has several meetings with the McDoogle brothers and at the last one before Cannon Hill,
Peklo manages to defeat the McDoogle brothers at the top of Cannon Hill, where the once mighty Armstrong Cannon resided. But the few surviving villagers are pissed off and yell at Peklo and his party to leave.
The party decides to go to Juts' Farm to find Giz, an obsessive follower of Diplo. Thernz remarks that Successor slammed the place magnificently too, and he has not been in contact with Giz. They discover Giz's skeleton at the bottom of a pit, long dead but not by Successor. They continue and find the wreckage that is Juts' Farm and manage to find Giz's diary on a table in which Giz laments the disappearance of Diplo and writes a hundred page essay on his hypothesis that Diplo has fled to Florence.
Before they leave, the table screams, “Penis.” Nagumo recalls how terrible Watsa was, but admits that she misses him since Successor killed him. The table begins to barrage the party with “Penises!” and they finally understand that somehow, Watsa is the Antique Table. They decide to bring him along. He acts as a save point on the world map as well as information database on monsters and etc.
Thernz, realizing that Peklo's emission of Grim is far too great an evil, says that to uncover the mystery behind Nightmare, they would have to somehow avoid as much human contact as possible, for humans have had a billion tragedies that could reawaken under Peklo's Grim.
They arrive at the coastal town of Groggermog. The town is very grim and religious, hating the old gods, and has already heard rumors of Peklo's terrible. They are extremely hostile and no one is willing to sail with the Grimbeast. They still try, going to many seaside pubs and such, and this is when they meet an ancient mariner, who overhears their problems.
He comes to their table and tells them of himself and of the terrors of the ocean. None of them (except Nagumo) are really fazed, so the mariner admires their courage. He agrees to give them his whaleship if they can beat him in a drinking contest (he really just wants to drink), and Peklo agrees to the challenge. They order copious amounts of mead and drink up. The mariner eventually faints, and Peklo is victorious. They stay in a nearby inn, and the next morning, the mariner takes them to the whaleship and they depart for Europe.
After a feast on the whaleship, Peklo meets Thernz, gazing out at the ocean. It is mysteriously foggy, and the two sense a disturbance. Peklo realizes that the wind is incredibly strong but against the ship. The wind is from the northeast, but the ship is hardly affected by it, continuing its descent south. Thernz is able to link the phenomenon to the po. Without the other half of the soul, po can only travel straight and not in diagonals.
Nagumo, sleuthing around, calls Peklo and Thernz. She has found a voodoo doll of Genkibonna, the Japanese God death and NERDS. Genkibonna is the Anime Skeleton. Morgull notices them and freaks out, tries to suplex Nagumo, but Thernz is able to counter his ferocious attack, but Morgull takes the doll. Peklo and Thernz both dumbfounded, Antique Table screams at them, “MAXIMUM PENIS.”
They realize he is Maximum Morgull, a cursed mariner who forever crosses Dour Sea. Peklo and his party may potentially be stuck in the eternal hell that is Maximum Morgull. Every hundred years, Morgull is able to dock, but only to get more victims to share his pain…
With no options left, they're forced to pursue Morgull. By now, Morgull has summoned the spirits of the deceased who rode his ship to act against Peklo, but the party manages to break through into the hold. They find a shrine dedicated to the Drummer. Peklo recalls the voodoo doll having a crystal shard impaled in it and suggests that it might have been a Drummer Fragment, like those used in the Coxenburg dungeon.
Morgull confronts them, and using the power of the Drummer, he yelps and waves his finger in the air so intensely that a portal rips open, sending the party to a mysterious island, the Dour Drum.
Peklo is able to escape, much to Morgull's surprise. The party uses this chance to steal the voodoo doll from Morgull and they pull out the Drummer Fragment. Morgull becomes terrified, as anime music begins to howl in the hold. Out from a treasure chest, Genkibonna sweeps in and takes Morgull's soul in revenge, and thanks the party.
Genkibonna tells them that Morgull trapped him in the chest. Morgull was enraged that Genkibonna introduced him to the terrible disease of Dragon Ball Z. Morgull believed his own resulting obsession, which led to his death, was the fault of the Japanese God. Genkibonna would have been able to use his sugoi powers but the Drummer Fragment was the most painful and not very kawaii. Genkibonna further reveals that the Fragment sapped his power and gave it to Morgull, but now Genkibonna was at FULL KAKKOII POWER. Genkibonna would be able to reverse the curse of the ship and lead them to Florence.