My opinion on the whole fixing of the two others guy's memories is that they had "broken" their own
memories and we had to fix them for them so that they could see the truth behind their lies. For example, Grimsom had convinced himself (apparently) that he was fighting two trolls, when he in fact killed 1 troll and 1 dwarf. And the other guy (forget his name) had convinced himself that he was doing the work of Zamorack, when in fact he had made it all up. (This probably doesn't fill all of the "plot holes," but it made it work for me
My biggest problem with the quest is how hard the final battle is. They require hi mining and smithing, but the final battle is all about your combat abilities (and even with having the minimum requirement I could not beat them both
). If they fix the combat at the end I'll be more OK with it, but atm I'm leaving it unfinished (because I can't finish it).