Yoga... the goblins I mentioned earlier are in the first world you can enter through the blackrock gem on the top down level below the castle
You however are talking to those three goblins caught in the caves below Castle British. They are not really any relevant to the game.
Of course you can return later and defeat that reaper, there's no crucial stuff he's guarding in the sink except:
1. The key to armory below the castle (which has among other plate chest, broad sword and battle axe, though in a pretty bad shape needing repair) which provides some benefits if entered early in the game but not very useful anymore after you visited the first and second worlds.
2. Magic longsword of (if I remember correctly) Major Damage which is again pretty good in the beginning but less so later on.
So you can safely leave him for now but return later and kill him just for the experience.