The goblins use the power of the pendulum to find a hidden passage near the giant floating statue, and make their way to the two-headed dragon cave.
How to Clear Gobliiins Level 17
Have 
Bobo/Asgard punch the pile of logs in the upper-left to make
a log fall off. Have 
Dwayne/Oups pick it up and use it on the
bear trap to spring the trap. Next, drop the log on the ground, and have
Hooter/Ignatius use magic on it to turn it into deodorant.
Have Hooter/Ignatius use magic on the bag of seeds at the top of
the steps in the lower part of the screen, then have him walk back to the left
to avoid the dragon's fire. Have Dwayne/Oups pick up the
seeds and also walk back to the left to avoid the dragon's fire.
Switch the cursor to an open hand and have Dwayne/Oups put
the seeds down on the ground near the wood pile in the upper-left part of the
screen. Then have him go get the deodorant. Then have him go get the seeds
so that he puts the deodorant on the ground near the wood pile.
Have him use the seeds near the wood pile,
then have him put the seeds back on the ground,
then have him pick up the deodorant. When the foot reaches the left side
of the screen, have Dwayne/Oups use the deodorant on it to
kill it. Change the cursor to an open hand and have him pick up the foot,
then click the top step in front of the dragon to put the foot in front of the
dragon, but quickly move to the left to avoid the dragon's fire. After a moment,
the dragon will breathe fire and cook the foot. Pick up the roasted foot.
Then use it on the bridge to the right of the bear trap. The bridge will eat
the roasted foot, and the goblins can safely cross the bridge after that.
Have Dwayne/Oups pick up the dagger that is near a sword and a
pile of bones. Then have him put the dagger down on the top step in front
of the dragon, and quickly go to the left to avoid the dragon's fire. Wait a
moment and the dragon will breathe fire on the dagger and light the end of it.
Pick up the burning dagger.
This completes the level. Make a note of the code in the bottom-left of the screen ( ), then click anywhere to continue to the next level, The Giant Statue, Part 2.