But...on to the questions. I have dispelled the Windspear Knights illusion but they are still hostile, are they supposed to remain hostile?
You've dispelled their illusions, yes, but they still think you're ogres/gnolls/demi-liches. They weren't prepared to listen to reason earlier on, and shouting "Hey, you're knights!" doesn't change anything. You do get some XP for being smart, though.
And the new dryad acorn options...what exactly does that do? I've talked to the dryad I'm supposed to give the acorns to but havent found any new dialogues or what have you.
As Bons says. Head down to around 3200.3470 in the De'Arnise Keep area. I see the readme is pretty unclear about what you have to do to see anything new here. Sorry about that.
P.S. I haven't thanked Ding0 for fixing the expanded acorns from the pathetic mess I sent to him post-IM4. Thank you, Ding0! Plus, I love Edwin's added interjections!
Well, no problem (and thank YOU for letting me use it), but I think the interjects are vintage Compton.