Need Y's 4 game help

From landis <xxxxxx@mail.nebi.com>
Date
I'm currently in this spot in the walkthrough:
16. Lefance Shrine
    Return to Serene and you'll find things quite different.  Everything
    is destroyed, and there's no one here!  The only living soul is an
    old woman where Banjo used to sit.  Talk to her, and she will take an
    item from you... and then reveal who she really is.  It might not be
    who you expect.

    Once she leaves, make use of the Seeker Magic that Torie gave you.
    It will reveal a hidden entrance, inside of which are the villagers.
    Banjo is still there, and will still make potions for you if you wish
    her to.  The door on the upper left leads to Lefance Shrine.  Talk
    to the woman and she will let you pass.

- Only 1 problem for me, she won't move out of the way when I talk to her.
What am I missing?  I've followed everything up to this point.  Any ideas?