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Johnny Troublefinder's First Mistake

The orangish glow was only a prelude to what sounds like thunderings all around you. Then, suddenly, a blinding flash of light causes you cover your eyes with your hands. In so doing, you drop the medallion to the earth.

When you open your eyes once more, you find that you are now seated in the dirt... in fact, you're covered in dirt! You begin brushing yourself off, when you realize there is a very startled looking old Druid standing over top of you. His dark runic robes touch the ground and his crooked oaken staff looks most foreboding! You scurry backwards along the ground until your back bumps up against a stone-masonry wall that you had not previously noticed. In fact, you had not noticed at first that you were in a room at all.

The mage adopts a quizzical look and then returns to a large tome, only muttering, "That can't be right...". You quickly look around and find no evidence of the medallion whatsoever! The only exit is to the southwest through a stone archway, and it appears to lead to a forest. On the other hand, there is a dagger with a golden hilt lying beside you that perhaps you could attack the old Druid with (After all, he isn't paying you any attention at the moment!).

What will you do, Johnny?