Chris, as nearly as I can remember (it's been quite a while since I played Temujin) you
do have to fill the memory book. Furthermore, there are apparently a couple of spots here where you can hit a dead end if you do things in the wrong order. I suggest you consult Fugazi's walkthrough
here for the exact sequence that things should be done in Chapter 2. There is also a tip for getting into the next chapter that might work for you.....