8: The Cold Flame of Agnon

The Elder Scrolls IV: Oblivion Guide - Shivering Isles

Quest 8: The Cold Flame of Agnon

You're headed to a place called Cylarne, where you are to kindle the Flame of Agnon and return to New Sheoth with its holy fire. While it may be a long trek, you can easily reach Cylarne by fast traveling to the Gates of Madness and then walking along the northern road there. If you happen to encounter an Obelisk of Order along the way, be sure to close it up. As Sheogorath mentions, the Golden Saint and the Dark Seducers of Cylarne often fight each other. Upon your arrival, you'll notice a distinct camp for each of the two groups. The Dark Seducers (also known as 'Mazken') hold the Altar of Despair on the left. The Golden Saints (also known as the 'Aureals'), hold the Altar of Rapture on the right.
 

Speak to the Aureal and Mazken commanders and pick a side.

Speak to either Vika or Chuna and tell them you are there to light the Flame of Agnon. You will be given a key, allowing you to enter either of the groups' encampments. To kindle the Flame of Agnon, one of the groups must take the others' ruin. So, you can assist either the Aureals or the Mazken. It really doesn't matter which group you choose to help, as it won't have an impact either way. Even if you wish to help the Aureals, start by locating the Mazken commander, Grakedrig Ulfri. She is inside the initial area of Cylarne on the Mazken side.

Work your way through Grakedrig Ulfri's dialogue tree and select the 'Battle Plans' dialogue option when it becomes available. Even if you wish to assist the Mazken, select the 'Let me talk to the Saints first' dialogue option. Head back outside and over to the Aureal side. The Aureal commander, Aurmazi Kaneh, is outside in the open with the other Aureals. Speak to Aurmazi Kaneh first. Then, speak to Mirel and select the 'The Underdeep' dialogue option.

Help the Aureals or the Mazkens wipe out the other side.

Once Mirel has told you about the Underdeep, return to Ulfri. Speak to Ulfri and select the 'I'll lead the Saints into an ambush' dialogue option. Return to the Saints' camp and speak to Aurmazi Kaneh once more. If you wish to help the Saints, select the 'I'll help you. Let's go' dialogue option. If you wish to help the Seducers, select the 'Yes, but use the Underdeep' dialogue option.

If you chose to help the Mazken, follow the Aureals into the Underdeep. They will discover that you have set them up and then turn on you. It wouldn't be wise to fight them all at once; instead,  run through the tunnels and pick them off one by one to avoid being cut down, as they will continue to pursue you with great ferocity. You have to kill all of them. If you chose to help the Aureals, just follow them around and help while they clear the ruins.

After the battle, find and speak to the commander you assisted. Then, follow her to the ceremony and watch as the Flame of Agnon is relit. Return to the Cylarne courtyard, and step on the flame to set yourself ablaze. Travel back to New Sheoth and locate the Sacellum Arden-Sul area.

When the Flame of Agnon is lit, return to Sacellum Arden-Sul in New Sheoth.

There is another decision to be made in Sacellum Arden-Sul. You can either light the great torch on the Mania side, or the great torch on the Dementia side. If you choose to go with Mania, speak to the man in the red robe, and you will be rewarded with the Raiment of Arden-Sul. The Raiment of Arden-Sul fortifies Willpower and Intelligence, and boasts Shield and Resist Paralysis enchantments. If you choose to go with Dementia, speak to the man in the teal robe, and you will be given the Raiment of Intrigue. The Raiment of Intrigue fortifies the Sneak and Security skills, and boosts the Speed and Luck stats.