Online:Like Blood from a Stone

Quick Walkthrough
#Find a key and enter the mine.
#Delve through the mine and learn more about what happened.
#Confront the Rethans.
#Choose whether to destroy the scroll or trust the Hlaalu Councilor with it.

Detailed Walkthrough
You'll find a Dunmer named Malur Rethan just outside of Balmora. Speaking with him reveals that he needs someone to investigate what's happening at the Vassir-Didanat ebony mine. He thinks his brother is hiding something from him. You're going to need to get a key to get inside.
You can either pickpocket it off of a man named Foreman Nox, or you can take one from his brother's office in their manor up the hill.

If you choose to steal a key from the manor, you'll need to unlock the simple lock on the front door and sneak past the hired guards patrolling the inside of the building. The first floor guard will move back and forth between the entrance doorway and the northern part of the room. She will conveniently face away from the door and towards the wall respectively during her rotations. The second floor guard patrols between the office and a room at the top of the stairs. He faces in to the doorways of each room he stands by. Be wary of which direction he's facing when you enter and make your escape. Other than that, sneaking in and out is a breeze, and you shouldn't have to engage either of the guards.

Once you have a key, enter the mine. There is a note near a corpse that may be of interest to you not too far from the mine's entrance, on the left. As you progress through the cave, you'll begin see strange corpses on the ground. Not too far in, you see some strange purple mist. Standing in it hurts you, so don't linger in it too long. Soon enough, you'll end up having to fight strange feral creatures with glowing purple eyes.

Follow the cavern until you've ended up at the southern portion of the mine. In a corridor, you'll find a letter. Read it and continue. On a desk a little further in, you'll find some incriminating evidence: a letter, this time more important. It's from Foreman Nox, and it mentions a scheme and an alchemist: Gavros. Pick it up and be on your way deeper into the mine. You should find this Gavros character in the Daedric ruin mentioned in the letter.

Fight through the Stonefiends. The ruins are just ahead. Try not to die in the purple mist. The journal you find in the next chamber alongside the other clues you've found should be enough to tell you that the Stonefiends you've been killing are the former laborers who worked in this mine, and that they have been deliberately turned into fake ebony (and not very good imitation ebony, according to Gavros) using an alchemical concoction created by Gavros the alchemist, hence the purple mist you've been seeing. Rethan intends to sell the fake ebony to his buyers, who don't care if it's genuine product or not as long as it's able to pass a cursory inspection.

Further in the ruins, you find a shrine to Clavicus Vile. Turning left at the shrine leads you to the Daedric Laboratory. The laboratory is full of purple mist. On a table lies a copy of The Vile Truth of Barbas and a more important document, some relevant research notes. Having read the research notes, you need to find the man behind these experiments. Delve further. Gavros is in the next chamber, sitting on a bench in front of a grate with purple mist spewing forth. He doesn't look too well.

Talk to him. He reveals that Master Rethan hired him to study a Daedric text that held the formula for turning living flesh into an imperfect imitation of ebony. He made the mistake of turning the liquid concoction into a vapor, making it impossible to contain. Gavros is very pessimistic about his situation. He tells you to take the nearby scroll and to be careful with it, as wealth comes at a price. Enter the Lift Room and leave Gavros to die.

Interacting with the lift will take you back up to the tunnel close to the entrance. Leave the mine and talk to Malur Rethan about your findings. You'll find him in the same place, loitering outside Balmora.

He will tell you to head to the manor and detain Benar Rethan while Malur reports to the Hlaalu Councilor, Rayveth. When you arrive, you will find Benar dead at the hands of an assassin. Kill the assassin and take her orders. Reading them reveals that Malur was going to have you killed after sending you to clear the Stonefiends out of the mine, and continue where Gavros left off. The intention was to make it look like you and Benar killed each other. 

With the damning evidence in hand, intrude upon Malur's meeting with Councilor Rayveth.

Head to the Randy Netch Inn in Balmora. Bring the evidence to the Councilor, who will tell you to kill Malur. Enter his city residence across the river and dispose of him and take the Formula. He is located downstairs. Once Malur is dead, return to the councilman and decide whether or not to give the scroll to him.
If you give the scroll to Councilor Rayveth, he'll be pleased and will double your pay. If you choose to destroy it, he will react in a way that implies that he would likely have had someone continue the grisly production of fake ebony.
 

Quest Stages