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if you teleport him just before he picks it up he doesnt spawn the hearts and you can attack the jar at your leisure
MY blind honour mod STORY:

1. I attacked him on the third encounter after he spawned the chest
2. He Poison Spored Lohse and others. Then he charmed lohse.
3. lohse proceeded to use andrenaline. then she charmed Prince (warrior with low magic armor). then she nether swapped fane into Lava.

I fled battle.

Cant manage to pick the jar on the last patch but attacking him while trigger a dialogue, you can pickpocket the jar with another character during this dialogue and destroy the jar during the fight (the exp on parasite waste around 4k for each to me rather than 11k)
I got the skill-book even though I fought the undead before even talking to him. Though asking him to train me caused him to give me a random book instead of my choice.
I hit him then teleported him to Jahan.

He dead.
You can no longer kill him after he spawns the chest. He will ignore you and teleport away regardless of how much damage you deal.
I finished this quest 2 days ago which would be 3rd of April 2018 and he spawned the chest, and then I hit him and he stopped to fight. You must've done it too late.
I successfully did it (check date). You have to be quick, basically hit him before or while he's pulling the soul jar.
Jut did it, but I got the villain tag for some reason
In my case I opened some jars in the main room, the skulls woke up and started the fight, but in the middle of the battle I hit that was sleeping with a fireball, he woke up hostile and only attacked my mage, so I used the fake death skill, the fight ended and started again without any dialogue, then in the forest he did not appear where he should. 8(
This walkthrough is really not accurate :( I couldn't give him any Source, and when I let him live after he killed the child, he just gave me some junk and disappeared - I couldn't kill him and couldn't enter the tomb.
You need source points or talk to a character with source points maybe, all I know is that you need source.
Good information but I dislike that this write-up is heavily biased towards min-maxing. Make choices that best suit your playstyle, there's no need to abuse game mechanics.

Yes I know I can probably change it but I'd rather complain.
I disagree. The guides should be about "min-maxing" as you put it, you can play any way you want, you don't have to follow the guide.
I, on the other hand, totally agree. The guide IS biased towards people who want to get max XP and loot and care little about story and consequences. Where is the lawful good option explaining how to kill Xhaxh and the other skeleton minions as early as the first encounter in Mordus' cellar thus preventing the suffering of innocents in the wake of the bloodthirsty lich? Well here it is: - After you solve the pressure plate puzzle, do NOT open any vases in the newly unlocked room! You can safely loot sarcophagi and chests though. - Talk to Xhaxh but do NOT show pity and do NOT agree to release him. This should be pretty obvious to a lawful good character as the undead's words outright betray his intention to go on a killing spree as soon as he gets off the rack. - Go down the stairs to the control panel. Do NOT press the green button! - Press the purple button to unlock one of the chests and loot its contents. - Move all but one party members up the stairs closer to the door where you came from, leaving the last next to the control panel. This character should preferably have high Movement and at least one mobility skill to allow quick retreat. - Use that character to press the red button on the control panel. This will immediately start a fight with the skeletons in the vases. - Let the character that pressed the button retreat to the rest of the party and pull all skeletons away from the source rack and Xhahx. This is extremely important because if any AoE damages the lich he will join the fight on your side and will be considered released by you. - Destroy the skeletal minions on the stairs then get back to the source rack. - This is the sweet part. Cast Restoration on Xhahx and he will jump off the rack on his own, as if he was never bound and drained, to attack you while screaming and cursing profusely. Kill him to end the quest and rid Rivellon of this maniac. All in all you get XP only from kills and from quest completion. You can still loot the unique 'Xhahx's Staff of Parasitic Decay' from the corpse of the lich. Now, if a moderator/admin is willing to add what I just wrote to the guide above, it will stop being biased and we can all hug and sing along.
Oh and you can get the lich's name as soon as your first conversation then use it to command him to tell you the truth in subsequent dialogue options. But I guess the min-maxers did not find that out because it requires you to read a certain book that is somewhere in the dungeon and reading books is so lame, right? No...
At the third encounter near the fountain -- try teleporting him away from the blood as soon as he summons the treasure box. He will immediately become hostile & you can kill him for the exp but the best part is HE DOESN'T SUMMON THE HEARTS!