At the end of Rescue Scarlet Robe you are captured by Jack of Blades who throws you in prison.
The objective of the quest is to find a way out of the prison.
If you want to complete the quest quickly you can use the following Fable Anniversary walkthrough.
Money: 0 + 45
Renown: 0 + 495
Trophy: Kraken Tooth
The quest starts while you are imprisoned. When the guard leaves you will have a conversation with an inmate. Then the guard returns telling you its time for the yearly race that they hold inside the prison. If you win you are entitled to a visit inside the wardens office.
But if you lose or you do something wrong inside the office you are thrown in the torture chamber and you must wait another year for the race. The race circuit is inside the Prison Courtyard. When the race starts head straight, turn right, and use the stairs.
Then turn left in the first and second towers, and as you reach the third tower turn left on the stairs to shorten the path. As you climb up again head left to win the race. After the race you are transported to the wardens office, where you can see three books on his desk.
The books are locked and require a combination, so when he starts reading his poem carefully sneak around the book shelves to read the combination from a piece of paper on the board (mind the detection bar in your upper right corner). Return with the combination and open one of the books. You will always open the wrong book and be thrown again in your cell for another year.
However, you can open the right book the next year. Inside the book is the Prison Cell Key, which can be used to open any cell door. Before exiting to the courtyard you can free the other inmates to distract the guards. Use the stairs to reach the second level of the courtyard and go through the door to enter the Prison Barracks.
Inside the chests you can find a full Guard Clothes suit and also your confiscated equipment. When youre ready to leave for good return to your mothers cell. You have to protect your mother all the way back to the Underground Chamber.
This time around the area is not empty, because a Kraken attacks you from the water. Keep the target locked on his tentacles and shoot them with the bow while walking around the water.
When you defeat all his tentacles he will reveal his head. Hit it with your bow (Multi Arrow can help a lot) and avoid his ray attack.
When the Krakens health is half you will need to face his tentacles once more. Defeat him for good to collect his tooth and head for the exit to complete the quest.