Killing charmed bear causes Erliter the Beggar...

Thanks.

Played with the save a little - I don't know why, but it seems the townsfolk hate Furnok for some reason. If you dismiss him from your party in an empty area, it seems to clear up the problem.

Did Furnok do anything unusual while he was in your party?

Also, Elmo seems to be carrying around some weird graphics glitch. Perhaps there is some memory corruption present. Did you save/load during combat or use the console?