Nightmare Realm
Hugo's Nightmare
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Find Hugo and wake him upThe Mabu on the left will teach you that the large sheep you can step on are bouncy, jump onto the one ahead to bounce up to the platform above it then do the same to the sheep on the left to get up onto some higher platforms where you can find 
Nightmare Page 1/3. Jump down to meet Bucktooth the Tiny and encounter your first pirate ship, this will start spitting out Chompies but you can attack the pirate ship itself to stop it. Once it's out of the way follow the path behind it to a few more enemies (including a Pirate Swashbuckler who is much like the wrench wielding Trolls you've fought before) and a Traptanium Crystal containing Treasure Chest 1/5.
Bounce along the sheep to get to a firebreathing Pirate War Mage, avoid the fire and the individual shots he makes as you take him down, he turns fairly slowly when using the flame attack so you can jump to the side and attack. Smash through the barrier behind them to get to an ambush, a few more of the anemone pirate enemies here to defeat along with a pirate ship on the right. Inside just on your right you'll see Hat 1/3 and at the back right corner is a key to pick up, exit through the left door.
Go up the book platforms to a swirling vortex at the top, this will take you back inside the same building except that now you're on the ceiling, the controls may be a little disorientating but go over to the right side to unlock the gate and exit. Outside defeat a few enemies and then talk to a Mabu who will tell you about a switch, use the switch to enter a quick activity. The aim here is to use your stylus to draw a line from each sheep to the circles, not that challenging. Smash the stuff on the left side where you land to find Treasure Chest 2/5, use the bounce pad afterwards to get to another ambush. Take out the pirate ship and the pirates to open the way.
Go left from the ambush down to a sleeping Skystone player (Pirate War Mage, Mutant Uber Chompy, Pirate Grenadier 2), bounce back up once you're done. Going to the right now use the switch to move another couple of sheep into position to bounce over to a few enemies and the gem safe Treasure Chest 3/5 in the corner. Go down the book steps and inside to see Bucktooth again and fight a couple of Bomb Shells. Exit to the right and bounce up the sheep (they're very close so don't jump too far) to a swirling vortex that'll take you inside and onto the ceiling, grab the key and then turn around and go back through the door down the sheep and inside again to unlock the gate on the floor.
Bounce across the one sheep to a platform with a switch on it, you can now place that sheep in one of four places. The bottom position allows you to reach Nightmare Page 2/3 and the top position allows you to get to the Magic Elemental Gate.
Magic
This one is a magic carpet ride much like the magic leaf ride in a previous level. You need to tilt the system left and right to move up and down to avoid the obstacles. When you get to the moving mines you'll generally want to aim for where the mine currently is rather than where the gap is, the mine should have moved by the time you reach it. It's just one sequence to reach the Hat 2/3.
Bounce back to the switch and move the sheep to the right position to move on. After fighting off an ambush collect Treasure Chest 4/5 from the left side and head up the slope to a few more enemies. Use the bounce pad to get up to a doorway and head inside. Bounce up to some enemies then again and again to a Traptanium Crystal with Treasure Chest 5/5 inside. Teleport back down and go out, drop down and smash through a barrier to the left before going up the books and into a vortex.
As you drop down to the left you'll find Hat 3/3, continue going left down past some Chompies and a Pirate War Mage to the key and a teleporter back to the start. Exit and go to the right where there's a locked gate to go through. Take out the ambush then go up the slope to another of the Lock Puzzles. Go through the door behind the Chompies and then up the bounce pad and into a vortex and then straight out to the left. Bounce up the sheep and into another door, take out a few Chompies and jump off to the right. Before you exit carry on past the door to find Nightmare Page 3/3. Outside there's another switch to move some sheep around, bounce over the book to an ambush.
After that last ambush go up the books at the back to fight Bucktooth the Tiny. He's just like the Pirate Swashbucklers, he'll run up to you and either smash his hook down or swing his hook at you. Attack by jumping over his head and hitting his back. After capturing him go talk to Hugo at the back to finish the level.
Villain Bootcamp - Bucktooth the Tiny
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Instead of a shiny gem what you're after now is a key to free the first of the three Sages of Waking. The Y attack slices grass and the X attack digs to try to find a key to the exit. Go forwards to the grass and start slicing, you should find a red X mark where you can dig down for the key to the gate - if you find a bomb when you're slicing or digging just back off and let it explode by itself. While Chompies will lower your time by two seconds if they hit you they won't immediately fail the challenge like the bombs will - you can spot where a Chompy is hiding as the grass will shake a bit. The exact positioning of the hidden things is randomised and will change if you fall in the water.
Hit the drum on the left to summon some turtles so you can cross over the water, slice the grass over here to find the X and dig up the key. In room two go through the grass and around to a drum to beat, cross the turtles and cut the grass on the left side of the gate to uncover a second drum, cross the new turtles to get to the grass at the back, the X is in there somewhere.
In room three there's a drum hidden in the first bit of grass, turtle over to the right and make your way through the grass all the way past a couple of arrows to another section of grass, dig up the first key here and then go up to the bottom edge of the water and a drum. Walk over the turtles to the locked gate and dig up the second key to exit.
Room four go through the grass to find a cross and the first key, then hit the drum at the back. Go to the left to loop around to the turtles, beat a hidden drum just before them and then cross over to some more grass. In the grass here is a drum and an X to dig up. Once you've beaten the drum get over to the grass by the gate to find the third key. In the very final room dig up one last key to free that Sage to finish the level.
Sleep Dragon's Lair
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Walk towards the sleeping Sleep Dragon and then into his Dragon House to his left to get to the actual level. Around the bend you'll find a couple of Pirate Swashbucklers and some Chompies, defeat them and jump along a series of books that appear and disappear on the right. You'll meet Shellshock Sheldon not too far ahead, he's a larger version of the Bomb Shells that you've met through the game. Follow the path along to the left avoiding his bombs and you'll reach a few enemies (including a regular Bomb Shell), continue going left over some vanishing books to a Lock Puzzle behind which is Treasure Chest 1/4. The red platforms to the right will collapse after stepping on them so keep moving up to where you find Nightmare Page 1/3, a bomb and a teleporter that will take you back to the bombable gate where you just fought some enemies.
Through the gate you'll find a switch which looks like the sheep switches from the previous level, instead you have three books that you can place in specific places (which means no problem for the challenge on this one), those spaces being the purple dots. If you tap on a purple dot it will turn brown and a book will appear on the top screen in that position, tap it again to make it disappear. You can have three of the spots active at once and you need to make a bridge straight over so just do a straight line of them. Over the bridge you'll get to an ambush, this ends with a Pirate Crew Master (otherwise known as a Brawl and Chain), he has two different attacks, one where he walks up to you and swings his hook at you and a second where he walks up to you, drops his hook chain and then starts spinning. Stand back when he spins to avoid getting hit, he won't move while he does it. Once the monster gates are down go to the right up some red platforms to a gem safe Treasure Chest 2/4.
Drop down from the safe and go forwards over a vanishing book to a solid platform in the middle with Treasure Chest 3/4 sitting on it. There's a key to the left and to the right on some more vanishing books, once you've got both of them jump forwards over a fourth book to the locked gate. There's a switch beyond, this time you have some choice when laying down the books. First make it so you can get to the platform on the right side where you'll find a Light Elemental Gate, this will need a Light element Skylander to open but if you haven't loaded one into the game yet it'll just be labelled as unknown.
Light
Pick up the lantern and walk forwards, you'll notice white square platforms appearing, walk over them across the gap. Do the same for a longer section, there's even a lantern partway through. Around the corner the next section will require you to jump over gaps in the platforms but there are no splits in the path so should be fairly simple. The last section has platforms at different heights but again no decisions about directions to go in. You'll then reach Hat 1/3 at the end.
Go to the switch on this platform and deselect the book at the bottom and move it to the left. Go over to the left platform and use the switch before picking up the bomb, you'll want to move the right book to the top. Run over and throw it at the gate on the top platform. Up the book steps and then along the long line of red platforms and teleporters. You'll eventually end up in a fight with a few enemies, drop off to the right and jump across a series of vanishing books, you'll have to time it so that you jump just as the one you're on vanishes and the next one appears. Over the other side is Nightmare Page 2/3 and a teleporter back.
Go forwards over the lines of vanishing books, jump from one side to the other as they vanish. Kill a few more enemies and go left through a barrier, before you go to the switch move towards the screen and drop down a small ledge to where there's a Traptanium Crystal with Treasure Chest 4/4. The switch this time lets you use five books (so keep two of them inactive for the challenge! Make gaps to jump over rather than complete paths), first arrange them so you can get to the platform on the right, once there avoid the switch and the bomb and instead open up Hat 2/3 at the back, when you've got that go back to the switch and arrange them so you can get directly over to the left side. Pick up the bomb and run over to blow up the gate, pick up the key then use the switch to arrange the books so you can reach the top platform and the locked gate.
To cross the vanishing book platforms ahead just run straight across as quickly as you can when the four books appear, you should be able to just about make it. On the other side is a Mabu who wants to play Skystones (Mutant Uber Chompy 3, Pirate Crew Master 2, Pirate War Mage 3), jump up some more vanishing books to the right and then forwards up to a locked gate.
Teleport away and go right across the red platforms to another teleporter, then left onto a bounce pad, some more red platforms, some vanishing books and then a third teleporter with the key right in front of it. Open up the locked gate to go through to an ambush. After taking down the Pirate Crew Master go to the right over a set of alternating vanishing books.
The next switch has six books for you to control (so don't use three of them if you're after the challenge), first use the books to go straight across to the locked gate, to the right of the gate is another switch, use it and bring up the two books on either side. Cross back to the first switch and use the six books to go over to the right and open Hat 3/3. Jump forwards over the red platform and pick up the bomb, run left over the books you made appear all the way past the locked gate to a bombable gate. If you walk towards the screen on this platform you can find a couple of enemies and Nightmare Page 3/3.
Use the key to open the gate and get ready to fight Sheldon Shellshock. Avoid the bombs he throws as you first take out the pirate ship on the side of the arena, once you do just take him on as you would any Bomb Shell by jumping the bombs and attacking. After capturing him grab the bacon and step into the teleporter, talk to the Sleep Dragon to finish the level.
Villain Bootcamp - Sheldon Shellshock
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Walk onto the first raft and throw some bombs at the large crate of explosives directly ahead, the raft will then start moving if you stand on the edges to direct it. Take it forwards towards the two pirate statues and then left so that you can blow up some more stuff. Bring it back to the right and step off where the statues are.
As you can't jump you have to press and hold the X button to go into your shell when a shockwave is passing by, wait until the flash occurs before popping back out. As you walk past the machine throw bombs at the barrels of explosive along the edge. Step onto the raft and go to the left, blow up the crate and any remaining barrels to open the exit ahead.
For room two you'll have to shield yourself when on the raft, you can even be moving when doing that so try to be moving in a direction you want to actually go in before you cower. In room three there's no machine but there is moving water, that pushes you in a certain direction which is impossible to go against. So to do this room go to the right and go in an anti-clockwise direction around the room blowing up barrels before going out the exit.
Room four is quite similar to room three but has a machine on the right side. Room five has several little sections of moving water that this time you want to avoid, manouver around them as you bomb the barrels and crates as the water will just take you to danger. The sixth room is like room three and four except that now it has machines when you're on the moving water, you'll have to try to throw further ahead just before you retreat into your shell and further back when you pop back out.
The final room just needs you to float over to the cage and then bomb it.
Dream Sheep's Dominion
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The level begins with a flying sequence, hold your 3DS vertically and tilt it around to move the Sleep Dragon from side to side and up and down. Shoot at the sheep but move out of the way of the books. Remember that if you do take damage it's easy to retry at this point with no progress yet, however be aware that there is another two flying sections later in the level.
After landing go up the slope to meet Russel Purplestache, a Pirate Crew Master. Go right past a lantern to get Treasure Chest 1/3, pick up the lantern and it'll reveal some steps leading up to where Russel was to fight a couple of pirates. Grab another lantern from the left and go forwards along a bridge made of books that appear as you get close.
Go to the right over a gap and defeat a couple of Bomb Shells to get the Nightmare Page 1/3 next to them, up the top of the steps you'll find a lantern, jump to a tiny platform to your right and then again to reach a Traptanium Crystal with Treasure Chest 2/3 underneath. Go back and use the lantern to go up some more steps to the Dark Elemental Gate.
Dark
Step forward and you'll stand on a booster pad, this will make you start running forwards. You can aim where you're running as well as jump but you can't stop, aim for the bounce pad at the end of each section to bounce to the next one. There's one vortex halfway through that just takes you to another part of the same thing, this time with split paths and thinner track. At the end is Hat 1/3 of course.
Go back down over the gap and continue along the path while carrying a lantern, cross over a load of the appearing books to reach an ambush. Fight off the Pirate Swashbucklers then go up the slope to the right, pick up the lantern and jump over to Hat 2/3. Grab the lantern again and go up the slope at the back of the ambush area, jump up and across the appearing platforms and you'll reach an area with several bounce pads.
Ignore the bounce pads and go to the right across some books to a third bounce pad, use it to go up through a lantern and land on some appearing books. Go up them towards the back right where there's Hat 3/3 in the air. Go to the left of the hat and you'll find a key. Jump down to the left and return to the first two bounce pads. Use the left bounce pad to bounce up onto some more appearing books that lead over to the left side of the blocking book above the gate. Now that you've got both keys jump down and open it up.
Time to destroy the first of the Nightmare Generators! Once you've taken out the last wave of enemies (a couple of Pirate Crew Masters will mark it) attack the Generator itself to destroy it. Time for another Sleep Dragon flying segment! This one's a little trickier than before as the sheep will move around a bit, try to shoot them as early as you can even if you think you're going to miss them entirely.
At the top of the slope behind the sleeping Sleep Dragon is a Skystone playing Mabu (Drow Goliath, Pirate Crew Master 3, Troll Illusionist). Just past him is another sleeping Mabu who tells you to use a huge bomb to boost yourself upwards, the bomb in question is to the right, get onto it and move as close to the books as you can to wait for it to explode you upwards.
After getting rid of some enemies above go to the left across some books to a quick ambush, get rid of those enemies and the gate will open up to let you find a bomb. Roll on it by tilting the 3DS all the way back over to the right, move it to the right platform and get up on top of there to find Nightmare Page 2/3 and Treasure Chest 3/3. You can make the jump from this high platform to the one at the back but if you fall off just go get another bomb to get up there.
Open up the Lock Puzzle then grab a lantern from the left to start going up the appearing books behind it, there are a few gems to the sides but nothing all that exciting, just go forwards up to solid land. After wiping out the ambush pick up the lantern from the right (head out to the left up some books to find a gem safe Treasure Chest 4/3) and go right, around a large book to a couple of enemies and a big bomb.
Pick up the lantern here and then jump onto the bomb, position yourself just underneath the book platform in the air above you and press B to detonate the bomb early. These books will take you to Nightmare Page 3/3, make your way along to the right down to the bomb again and this time ride it around the vertical books to the raised up platform down below.
Another small ambush ahead, take the key from the left once you're done and unlock the door on the right. Use the lantern and go left of where the key was to reach another large bomb. Pick up the lantern to refresh the timer then run the bomb back to the ambush and north along some appearing books. At the end explode upwards to another ambush for the second Nightmare Generator.
Once you're done with that take a third and final ride with the Sleep Dragon. Much the same as the previous flight except with loads more books. After landing you have to fight Russel Purplestache, he's just like the Pirate Crew Masters so stand back when he does the spin attack and jump back when he does the single swipe.
Villain Bootcamp - Russel Purplestache
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Step forwards onto the raft, unlike the previous bootcamp you can only control the raft by pulling on hooks attached to the wall. While standing on the raft press the X button facing the white and red life ring to pull yourself and the raft towards it. On the walls you can see some Sea Slugs (look more like snails to me), pull them towards you with your hookshot and then uppercut them with the Y button. If you're going for the challenge make sure to do them one at a time to limit the amount of time they have to get back.
In the first room step onto the raft and pull yourself left then upwards, there's a Slug to the right then a raft to the left. On the floor is another slug and on the wall past it another one. Go onto the third raft to pull yourself towards the exit, get the last slug from the right to open it up.
In room two pull the raft left, hit the slug on the ground and then the two wall slugs to the left and up. Pull the large crate towards you and then get back onto the raft to pull yourself to where the crate was. Now just one on the floor and one on the wall to the right to exit.
For room three first remove the slugs from the walls to the left and up as well as the one on the ground. Then pull the left crate to the left and move the raft left once. Get off the raft and pull the back right crate to the starting position of the raft, get back onto the raft and move over to the exit where there's one last slug on the wall.
In the fourth room walk forwards to get the slug then pull the crate ahead of you towards you. Diagonally walk onto the raft and off to the left to get all the slugs on the walls and floor over there. Get onto the raft and pull yourself to the exit where there's one more slug to the left.
In room five remove the slug and get onto the raft, pull yourself right then get onto another raft and pull yourself down. Hit a slug on the ground and two on the wall to the right before pulling the crate that's next to the raft towards you, then pull the other crate into position where the first crate was and get back onto the raft. Go up then right then up again. Some slugs on the wall to your right and ahead, step on the raft and pull it down. Going left over one more raft to a final slug and the exit.
Get the slug on the floor in the sixth room along with the two on the right wall before getting on the right raft and moving down, get off and move the crate to where the right raft was. Now use the left raft to get where the crate was. Go left over a couple of floor slugs and two on the left wall. Get on the first raft here and pull yourself to the right, that'll let you pull the crate behind it to where it was. Walk over that raft to get some slugs off the right wall then step onto the second raft, pull yourself down then get off and pull the crate to the right. Now you can go around to the third raft and pull yourself right to reach the exit and the last two slugs.
Pull yourself over to the cage and smash it open to finish the bootcamp.
Dream Sheep's Lair
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Go through the door to start the fight with the Dream Sheep. It begins just like your previous fights with them, run to the left to avoid the tail then jump over the shockwave. Run left to avoid the wing attack then jump over the tail slide attack that swings around the whole arena. The orange circles will now start spewing lava, you should be able to see which ones are about to become active as they work sequentially around the arena. Hit his tail and knock it back into him to bring the Dream Sheep down, take off a third of his health to move on to the next part of the fight.
Just as you should have been expecting the second part is every doubled up. Once you get to the tail stuck part there will also be fireballs raining down on you to avoid. And yes, you guessed it, the third stage has everything done three times. If you manage to get a third off each time (use a Trap Master) and beat him on that third attack you should do fine for the time part of the challenge.
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