Hirato: At the end of the mentioned cave is a ladder and a trap door.
As far as I can tell this trapdoor leads to the back of Loredo's residence.

Considering how bigoted most humans are in this world, I also considered the possibility of the humans implicating the squirrels rather than squirrels being responsible for their deaths.
These are the guards after all, they've likely confiscated lots of s'coiatael equipment.

Due to that, there is reason for a first time player to believe she might be innocent and the player will therefor choose to gamble on that possibility.