So, 2020 and all that, I took another shot at TOEE over the holidays. The really strange thing that happened was that I randomly managed to hit Falrinth for exactly the amount of HP that he had left, i.e., what would normally leave him disabled. Instead, the game immediately jumped to him out of initiative order. He said something like he was recovering from his evil bewitchment (full story available from Allrem as part of his third quest, but Falrinth was originally co8, but charmed after emridy meadows I think) and then cast a spell that I thought was a teleport. The combat ended, I had already killed the quasit, but there was some glowing graphics where he had been standing. Weird. When I came back through the tunnel later, I noticed messages that he was casting spells, which you usually see, so I visited again. He was there, but would only converse with single responses like most plot-insignificant characters. Anyone have this happen to them?
Now that I think about it, maybe I should try casting dispel magic on him, a la Paida, from out of the range at which he initiates conversation.