What is happening:
Silver Tongue, an NPC on a balcony of the Crystal Castle, has rather glitched dialogue. It is apparent that he is supposed to give you a cupcake (if you agree) and a quest if you talk with him again, but neither happens, and there is no offer for the quest in the first dialogue that would prompt you to speak with him again.

Additionally, that quest is supposed to include three items that do not appear.

(This quest just looks incompletely developed, that's all.)

Linux 64-bit, v0.1.4