I am also stuck on the first level. Mandy has spoken to me but I cannot get Drake or Holy Avatar to walk to the mushrooms, they both end up stuck near the tree to the right/'north-east' of the mushrooms.
I tried again today, and for some reason I was able to get Drake to move so he was almost next to Mandy and therefore able to kill the mushrooms. However, Holy Avatar was still limited to movement around a few squares near the tree I mentioned in my above post. Then, once the mushrooms were killed and the next mushroom appeared I experienced the same thing again. Drake cannot get anywhere near to the latest mushroom, and I have no idea why. Again, he can only move within a limited number of squares, and it is very frustrating.