I like this episode, and would recommend others not the skip this funny, yet insightful episode. Don't leave just yet, stick around for the end credits you might get a surprise waiting at the end. I don't know about fabricating an entire lie just to have better relations with human settlements is a wise. If anything wouldn't the emergence of good monsters defeating evil monster make a better story to sell, and is factual using your friendship with human adventurers would greatly sell your friendly towards humans. It is just a thought!