“Aiming to avoid needless battles, the Altean army decided to cross the central mountain range, thought to be impassable by a large army. Should they go through the Adria Pass, they would reach the palace directly. "Hurry, we cannot let the enemy notice us! We must charge straight through!" Praying for success, Marth and the others walked through the narrow mountain pass. However, despite their prayers, they were attacked by an unexpected enemy in the pass. The northern Kingdom of Aurelis's elite force, which had moved south to aid Akaneia… The "Wolfguard."”
—Opening Narration, Shin Monsho
“To avoid needless battle, the Aritian army decided to cross the central mountain range, said to be impassable for a large army. Once they passed Adria Peak, they would be directly at Pales. Hurry, we can't let the enemy spot us! We must charge straight through!! Marth and the others were anxious, but they carried on advancing across the narrow mountain road. But they didn’t expect, in the middle of the cliff, to be ambushed by an unfathomable enemy. They were the northern Kingdom of Orlean's elite squad, the "Wolf Knights”, who had headed south to aid Akaneia.”
—Opening Narration, Mystery of the Emblem
The village on the south-west contains the Lifesphere AND signals retreat to the horsemen and paladin in the north, allowing you to spare the Wolfguard units for recruitment later. You can kill the generic units with them, however, with no consequence.
Also there is an Arms Scroll inside the cave.
This chapter is not that challenging, as long as you visit the village quickly. There are two easy ways of going about this chapter, the moderately fast, or the single turn strategy, although you may want to go with the latter, should you be low on Warp staff uses and are low on Hammerne uses, as Warp can make Chapter 20 a lot less painful, and will allow you to get some very good items in Chapter 23.
For the moderately fast strategy, you can do one of two things. Either Warp Marth onto the village, or have a combination of a staff user with Again and Phina chain so that he can visit the village turn 1, forcing all of the Paladins in the north to flee turn 1, and allowing you to take as much time as you want for the rest of the chapter.
For the single turn strategy, Warp Marth onto the village to get the Lifesphere, then Rescue Marth back. Dance for Marth, then have someone else Warp him beside the boss. Defeat the boss with Marth, then use the Again staff to seize the throne. If Marth cannot one-round the boss, warp another unit over to the boss and use them to defeat him, then Warp Marth and seize.